Senate Finance reviews bill to require annual reporting by health-care sharing plans

S.132, an act that would require annual reporting by health-care sharing plans and arrangements, received its first detailed review at the Senate Finance Committee on April 2. The measure would add a new section to Title 8, Chapter 107, obliging persons who offer plans or arrangements to facilitate payment or reimbursement of health-care costs for Vermont residents — but who are not licensed insurers — to submit prescribed data to the commissioner by Oct. 1 of the year and again on or after March 1 each year thereafter.

The change is intended to give regulators a baseline picture of who is operating these programs, how many Vermonters participate, what requests for reimbursement look like, and how often claims are denied. “This is an act relating to annual reporting on health care sharing plans and arrangements,” said Jen Carvey of the Office of Legislative Counsel while outlining the bill’s required fields, which include participant counts, provider contracts, total fees collected, amounts retained for administration, counts and dollar values of reimbursement requests and payments made, denials and appeals, and lists of third-party enrollers and producers.

Why it matters: proponents and state staff said healthcare sharing plans — historically religiously based “ministries” that pooled donations to cover members’ medical needs — have evolved into nationwide, advertising-driven providers that often present themselves with insurance-like language while not being subject to state solvency, coverage, or consumer-protection rules. Without filings or registration, the state has limited ability to track who is soliciting Vermonters or to spot patterns that prompt enforcement or consumer outreach.

Department of Financial Regulation staff described gaps the bill aims to close. “If you are licensed as a [producer] in Vermont, you’re not allowed to facilitate or accept money for the sale of healthcare sharing plans in Vermont,” said Emily Brown, deputy insurance (Department of Financial Regulation). Brown and other witnesses told the committee the department can act when a licensed insurance producer violates state law, but it currently has no routine filings, reserves, or reporting to measure the size and activity of these plans.

Advocates and consumer representatives urged action. “These things are designed to fool people,” said Michael Fisher, the state health care advocate, summarizing complaints his office receives from consumers who believed they had insurance-like coverage and then discovered limits, exclusions, or outright denials when they sought payments. Fisher said his office has handled a small number of cases but that those complaints probably undercount the problem because many affected consumers do not know where to complain.

Insurer representatives also urged disclosure and stronger rules. “They look a lot like health insurance. They’re not health insurance,” said Sarah Tichat of Blue Cross and Blue Shield of Vermont, noting that sharing plans commonly exclude preexisting conditions, cap or delay coverage for childbirth, and omit other consumer protections that regulated insurers must provide.

Supporters said collecting data would not by itself regulate or license the plans but would allow the Department of Financial Regulation to post a summary report and evidence-based consumer information on its website. The bill includes administrative steps for the commissioner to review submissions for completeness within 45 days, require remedy of any deficiencies within 30 days, impose administrative penalties up to $5,000 per day for noncompliance, and, if unpaid, issue cease-and-desist orders.

Some witnesses, including department staff, expressed caution about unintentionally “legitimizing” the entities by requiring them to file. Brown said the department’s concern is that a reporting regime might be interpreted as official recognition. Several committee members and witnesses referenced other states’ approaches — Colorado’s reporting requirement and enforcement actions in New Mexico and Massachusetts were cited as models or cautionary examples.

The committee did not take a vote. Committee members said they want further work on precise definitions and on balancing the trade-off between transparency and the appearance of endorsement; the bill’s sponsor is expected to appear for additional testimony and to refine language on who must report and how consumer-facing materials should be handled.

Ending: The committee left the bill for further consideration and requested follow-up information, including complaint counts the department can provide and samples of out-of-state filings and consumer alerts used by other regulators. No formal vote or amendment was recorded during the session.