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Short-term junk plans Archives — Protect Our Care

California is the Latest State to Fight Trump’s Expansion of Junk Plans

While The Trump Administration and Republicans in Congress Push Junk Plans, States Join Health Care Advocates and Congressional Democrats in Fighting Back

 

Washington, D.C. –  While the Trump Administration continues its efforts to attack people with pre-existing conditions and sabotage health care through the expansion of junk insurance plans  — and Republicans in Congress refuse to join their Democratic colleagues in the Senate and House in stopping them — the state of California joins other states in protecting its residents from dangerous ‘junk’ plans through new legislation signed into law Saturday.

Going one step further in its rebuke of the Trump Administration’s disastrous health care policies, California also enacted new legislation protecting Californians against the Trump Administration’s scheme to reduce Medicaid coverage by imposing rigid work requirements. This is a win for health care, as these work requirements have proven to be impossible for many of those most in need of health care coverage to meet.

Brad Woodhouse, executive director of Protect Our Care issued the following statement in response to the growing fight against junk plans:

“While Trump and his Republican allies take a sledgehammer to health care, it becomes even more important that states like California and others step up and protect our care, which is exactly what the American people want our leaders to do. The reasons that officials are fighting Trump’s junk plans in the states, that health care advocates are fighting them in court, that Democratic health care champions in Congress are fighting them on the Hill are simple: these junk plans are allowed to deny coverage to people with pre-existing conditions, they are not required to cover key benefits, such as cancer treatments and prescription drug coverage, and they deceive consumers by refusing to pay for costs after a person gets sick. Since these insurance plans truly are ‘junk’ and have a long history of scamming people who need health care coverage the most the real question is why Donald Trump thinks he can call himself a protector of people with pre-existing conditions at the same time that he and his allies in Washington are pushing junk plans onto the American people?”

 

Insurance Commissioners From Coast to Coast Have Spoken Out Against Short-Term Junk Plans:

Dave Jones, California Insurance Commissioner: “Of Course They’ll Be Less Expensive…That’s Because It’s Junk Insurance And It Won’t Cover The Same Things.” [HuffPost, 8/5/18]

Jessica Altman, PA Insurance Commissioner: The Administration Isn’t Talking About How Limited These Plans Are. “I’m frustrated with how [administration officials] are presenting this…They’re saying, ‘Here’s this option that’s affordable and wonderful,’ and not talking about how limited the plans are…You can look at one of these plans and you’ll see it covers doctors, hospitals, maybe even drugs, and so you think it will have everything I need…You won’t realize that the amounts are caps, or have exclusions ― it’s really difficult to expect that consumers will be able to figure out what all of this means, and really know what they are getting.” [HuffPost, 8/5/18]

PA Insurance Commissioner Jessica Altman Has Already Revoked The Licenses Of Eight Brokers Or Agents Misrepresenting Short-term Plans. “In Pennsylvania, Altman said she has already revoked the licenses of eight brokers or agents who had been misrepresenting short-term plans.” [The Hill, 8/12/18]

TN Insurance Commissioner, Julie Mix McPeak Is Concerned About Whether Consumers Fully Understand The Plans They Buy. “‘We have to really make sure consumers know what they’re purchasing, and they’re aware of what’s covered and what’s not covered,’ Mix McPeak said. ‘The last thing we need is for consumers to have surprise bills.'” [The Hill, 8/12/18]

Lori Wing-Heier, Director Of Alaska Insurance Division: “I’m Concerned That People Will Buy These Policies, Show Up At The Hospital For A Condition They Did Not Expect, And Discover They Are Not Covered.” [HuffPost, 8/5/18]

Lori Wing-Heier, Director Of Alaska Insurance Division: Under Short-Term Plans, Insurers May Use Information You Submit In Good Faith To Deny Coverage. “You fill out the form, the medical forms, you think you are being honest about your history, and then the insurers go through your records and find something that you didn’t think was an issue, your doctor didn’t think was an issue, but now the insurer is saying it’s a pre-existing condition.” [HuffPost, 8/5/18]

Michael Conway, Colorado Interim Insurance Commissioner: People May Read Warnings, But Not Understand How Bare-bones These Plans Really Are. “They may read [the warning], but that’s not the same as understanding it…Because of the ACA, now people think the baseline has changed ― that certain things are always covered.” [HuffPost, 8/5/18]

Troy Oechsner, Deputy Superintendent At New York Department Of Financial Services: “These Are Substandard Products.” “‘These are substandard products,’ sold on the premise that ‘junk insurance is better than nothing’ for people who cannot afford comprehensive coverage, Troy J. Oechsner, a deputy superintendent at the New York Department of Financial Services, told the insurers.” [New York Times, 8/6/18]

View Protect Our Care’s factsheets on short term junk plans and association junk plans for more information.

 

Advocates, Elected Officials Fight Trump’s Junk Plans on All Fronts

New Lawsuit Filed by Health Care Organizations Seeks to Invalidate Trump’s Harmful Junk Plan Rule

New House Resolution, Mirroring One in the Senate, Would Override The Trump Administration’s Rule To Stop Junk Plans

Washington, D.C. – On the heels of the Trump Administration expanding junk plans that can deny coverage to people with pre-existing conditions, that are not required to cover key benefits, such as cancer treatments and prescription drug coverage, and that can refuse to pay for costs after a person gets sick, health care advocates and Democrats in Congress are fighting back.

Today, the Association for Community Affiliated Plans (ACAP), National Alliance on Mental Illness (NAMI), Mental Health America, American Psychiatric Association (APA), AIDS United, National Partnership for Women & Families, and Little Lobbyists filed suit in the U.S. District Court for the District of Columbia to invalidate the Trump Administration’s short-term junk plan rule issued last month. This lawsuit comes just after Congresswoman Kathy Castor (D-FL-14) introduced a resolution that would override the Trump Administration’s rule to allow insurance companies to sell junk plans that charge people more money for less care. The Senate has a companion resolution that is awaiting any Republican support.

Brad Woodhouse, executive director of Protect Our Care issued the following statement in response to the multi-front fight against junk plans:

“The Trump Administration’s never-ending war on health care is not going unanswered. It is facing resistance on the Hill, resistance in the courts and — as poll after poll shows — resistance from the public. House and Senate Democrats have entered the arena to fight for hard-working Americans. Now, it’s time for Republicans to join them.”

House Republicans Who Claim to Support Pre-existing Conditions Protections Should Prove It and Join Castor’s Resolution:

Rep. Martha McSally (R-AZ): “Rep. McSally Is Committed To Ensuring That Individuals With Pre-Existing Conditions Have Access To Affordable Coverage Options And Cannot Be Denied Health Insurance.” “Rep. McSally is committed to ensuring that individuals with pre-existing conditions have access to affordable coverage options and cannot be denied health insurance. She will work to ensure the House reform package includes these protections.” [Tucson Weekly Dispatch, 3/1/17]

Rep. Carlos Curbelo (R-FL): “We’re Keeping The Things That Work, Like Guaranteed Coverage For Pre-Existing Conditions.” “We’re keeping the things that work, like guaranteed coverage for pre-existing conditions, allowing young people to remain on their parents’ plans until the age of 26, and prohibiting discrimination against women.” [Sunshine State News, 3/11/17]

Rep. Brian Mast (R-FL): “We Also Need To Ensure That Patients With Pre-Existing Conditions Won’t Be Denied Coverage.” “We also need to ensure that patients with pre-existing conditions won’t be denied coverage and that those who rely on Medicaid have access to quality care.” [Palm Beach Post, 3/9/17]

Rep. Bruce Poliquin (R-ME): Rep. Poliquin Would Only Support A Repeal Of The ACA If The Replacement Includes Coverage For Pre-Existing Conditions.” “Poliquin would support a repeal of the Affordable Care Act, but only if the alternative plan includes coverage for pre-existing conditions, allows young adults to remain on their parents’ plans until the age of 26, and doesn’t immediately end Obamacare exchange policies.” [WABI TV5, 1/24/17]

Rep. Erik Paulsen (R-MN): “Rep. [Erik] Paulsen has long supported protections for individuals with pre-existing conditions, and he continues to do so,” a spokesman for Paulsen, the Republican representing Minnesota’s Third Congressional District, said in a statement. [Star Tribune, 6/23/18]

Rep. John Culberson (R-TX): “Health Care Should Be Accessible For All, Regardless Of Pre-Existing Conditions Or Past Illnesses.” [Rep. Culberson Website Content Current as of 4/20/17]

Rep. Dave Brat (R-VA): Rep. Brat Stresses Care Would Continue For Those With Pre-Existing Conditions.” “He calmed nerves, for some, by stressing care would continue for those with preexisting conditions.” [CBS WTVR 6 News, 2/21/17]

Rep. Scott Taylor (R-VA): “We Will Protect Those With Pre-Existing Conditions.” “We will protect those with preexisting conditions, we will work help those who can’t help themselves, work to get more access and more people covered.” [Republican Party of Virginia, 3/10/17]

 

Protect Our Care Calls on Senate Republicans to Support Sen. Baldwin’s Resolution and Protect People with Pre-Existing Conditions

Resolution’s Passage Would Stop Junk Plans and Protect Americans With Pre-Existing Conditions

Washington, D.C. – Senator Tammy Baldwin (D-WI) has garnered enough support to force a vote on her resolution to block insurers from selling the Trump Administration’s short-term, junk insurance plans, with 45 Senators signing onto the bill. Now, Brad Woodhouse, executive director of Protect Our Care, calls on the full Senate to support and pass this bill, which is supported by over a dozen health care and patient advocacy groups.:

“By gathering enormous support for this resolution, Senator Baldwin and her colleagues are once again showing the American people who is fighting for them. Now it’s time for Senate Republicans who all of the sudden claim to be protectors of people with pre-existing conditions to put up or shut up. If the GOP truly cared about protecting Americans with pre-existing conditions, they would join their colleagues on this resolution in taking concrete action to preserve the protections and essential health benefits that tens of millions of Americans depend on — and they would do so immediately. Republicans’ silence on this resolution is complicity in Trump’s assault on people with pre-existing conditions through the promotion of junk insurance plans.”

 

ADDITIONAL BACKGROUND

Right Now, The GOP is Actively Pushing A Bill to Weaken Pre-existing Conditions Protections

  • Twenty-eight Patient Groups – Including the American Cancer Society Cancer Action Network, American Heart Association, March of Dimes – Oppose the GOP Senate Bill. Writing in opposition to the bill, the groups explain, “it would not ban pre-existing condition exclusions and would remove rating restrictions based on age, gender, tobacco use, or occupation. This means that many individuals could still face higher premiums and out-of-pocket costs and, even if enrollees paid the increased premiums for many months, they could still be denied benefits because of a pre-existing condition. In short, this bill would not replace critical protections in current law.”
  • Americans Could Be On The Hook For Tens Of Thousands Of Dollars Should Existing Pre-Existing Conditions Laws Be Replaced With Those Proposed By Republicans. According to a report in Vox, “An easy illustration: CMS says that lung cancer costs roughly 12 times as much as the average premiums. So if the average premium is $1,000 per month, then lung cancer treatment costs about $12,000 every month. Sickle-cell anemia is eight times the average premium. So is multiple sclerosis. Cystic fibrosis treatment is expected to cost $14,000 if the average premium is $1,000. Those numbers are hypothetical, to be clear, but you get the idea. Americans could be on the hook for tens of thousands of dollars if their health insurance no longer has to cover their preexisting conditions.”

GOP Senators Have Also Refused to Defend Pre-existing Conditions from the Trump-GOP Lawsuit

  • Not One GOP Senator Has Signed On To Sen. Manchin’s Resolution That Would Allow The Senate To Defend Pre-existing Condition Protections In Court. This summer, the Trump Administration refused to defend against  a lawsuit brought by twenty conservative states aimed at overturning the Affordable Care Act and its protections for people with pre-existing conditions. Last month, Senate Democrats introduced a resolution that would authorize the Senate Legal Counsel to intervene in the lawsuit and defend protections for people with pre-existing conditions. Senator Collins refuses to support the resolution.

Short-term Plans Hurt People with Pre-existing Conditions

Short-Term Plans May Exclude Coverage For Pre-Existing Conditions. “Policyholders who get sick may be investigated by the insurer to determine whether the newly-diagnosed condition could be considered pre-existing and so excluded from coverage.” [Kaiser Family Foundation, 2/9/18]

  • As Many As 130 Million Nonelderly Americans Have A Pre-Existing Condition. [Center for American Progress, 4/5/17]
  • One in 4 Children Would Be Impacted If Insurance Companies Could Deny Coverage Or Charge More Because Of A Pre-existing Condition. [Center for American Progress, 4/5/17]

Junk Plans Mean Higher Premiums For People With Pre-Existing Conditions. By promoting short-term policies, the administration is making a trade-off: lower premiums and less coverage for healthy people, and higher premiums for people with preexisting conditions who need more comprehensive coverage.” [Washington Post, 5/1/18]

Short-Term Junk Plans Can Refuse To Cover Essential Health Benefits. “Typical short-term policies do not cover maternity care, prescription drugs, mental health care, preventive care, and other essential benefits, and may limit coverage in other ways.” [Kaiser Family Foundation, 2/9/18]

Under Many Short-Term Junk Plans, Benefits Are Capped At $1 Million Or Less. Short-term plans can impose lifetime and annual limits –  “for example, many policies cap covered benefits at $1 million or less.” [Kaiser Family Foundation, 2/9/18]

For more information, see Protect Our Care’s fact sheet on short-term junk plans.

“Cheap for A Reason”: Outcry Against Trump’s Junk Plan Proposal

This morning the Trump administration announced its decision to allow junk plans that can deny coverage to people with pre-existing conditions, that are not required to cover key benefits, such as cancer treatments and prescription drug coverage, and that can refuse to pay for costs by claiming that you had a pre existing condition you didn’t tell them about.  

News coverage has called the administration’s actions out for what they are: a blatant move to dismantle protections for people with pre-existing conditions and undermine the Affordable Care Act.

Headlines paint a telling picture:

  • HuffPost: Horrible Health Insurance Now Legal Again, Thanks To Trump. [HuffPost, 8/1/18]
  • Bloomberg: Short-Term Health Plans Backed By Trump Are Cheap For A Reason. [Bloomberg, 7/31/18]
  • Associated Press: Officials Are Promoting Lower-Cost, Short-Term Health Plans. [Associated Press, 8/1/18]
  • New York Times: ‘Short Term’ Health Insurance? Up To 3 Years Under New Trump Policy. [New York Times, 8/1/18]
  • San Diego Union-Tribune: Trump Administration Widens Availability Of Skimpy, Short-Term Health Plans. [San Diego Times-Union, 8/1/18]
  • Politico: Trump Whacks Obamacare By Boosting Short-Term Health Plans. [Politico, 8/1/18]
  • Washington Post: Trump Administration Widens Availability Of Skimpy, Short-Term Health Plans. [Washington Post, 8/1/18]
  • Los Angeles Times: Trump Administration Moves To Further Expand Skimpy Health Plans. [Los Angeles Times, 8/1/18]
  • NPR: Under New Rules, Cheaper ‘Short-Term’ Health Care Plans Now Last Up To Three Years. [NPR, 8/1/18]
  • Governing: Trump Administration Loosens Restrictions On Skimpy, Short-Term Health Plans. [Governing, 8/1/18]
  • Kaiser Health News: Trump Administration Loosens Restrictions On Short-Term Health Plans. [Kaiser Health News, 8/1/18]
  • The Cut: Trump’s New Insurance Rules Put Women And Children At Risk. [The Cut, 8/1/18]

Reporters have been quick to note that these plans will hurt consumers…

Los Angeles Times: Expanding Short-Term Plans Is Opposed By Nearly Every Patient Advocacy Organization In The Country. “Expanding short-term plans also risks driving up costs for Americans with preexisting medical conditions who need more comprehensive benefits…Among the groups that have opposed the Trump administration’s moves are virtually every leading patient advocacy organization in the country, including the American Lung Assn., the American Heart Assn., the Cystic Fibrosis Foundation, the March of Dimes, the National Multiple Sclerosis Society, Susan G. Komen, AARP and the advocacy arm of the American Cancer Society.

HuffPost: Short-Term Plans Provide Junk Coverage And Drive Up Costs Of Comprehensive Care. “Meanwhile, those seeking out comprehensive plans because they want or need them will discover those policies have gotten more expensive, thanks to the way short-term plans will affect the rest of the insurance market. Some insurance shoppers will have serious, even life-threatening diseases, such as cancer, which will mean their insurance must have a full set of benefits. But those kinds of policies will become more expensive than they can afford. [HuffPost, 8/1/18]

Bloomberg: Cheaper Plans “Can Come At A Cost.” “For some people, though, the cheaper premiums can come at a cost, such as when insurers claim that a cancer treatment shouldn’t be covered because a patient had the disease before buying coverage, as Bloomberg reported in October.” [Bloomberg, 7/31/18]

Short-Term Plans Sometimes Impose Unexpected Rules, Like For Instance Refusing To Cover Hospitalizations During The Weekend.There may be other strange rules. A review of some plan documents from Families USA found an Illinois plan that would cover only hospitalizations beginning during the week — inpatient stays that began on the weekend would not be allowed except in rare circumstances. Some plans had waiting periods for care. Cancer treatment, for example, is not covered in certain plans during the first month a person is enrolled in a plan, and no treatment for illness is covered in the first five days. That’s the kind of detail that might be easy to overlook when signing up for a plan if you aren’t expecting a cancer diagnosis.” [New York Times, 8/1/18]

….financially benefit insurance companies….

With Short-Term Plans, Insurance Companies Can Spend Less Money On Medical Care. “According to research from the National Association of Insurance Commissioners, the average short-term plan in 2017 spent less than 65 percent of premium dollars on medical care. Some of the short-term plans in the association’s analysis keep more than half of all premiums as overhead and profit.” [New York Times, 8/1/18]

Brokers Tend To Make Higher Commission On Short-Term Plans. “Brokers also tend to make higher commissions on the short-term plans, since the companies share a cut of their larger profits to get referrals. According to eHealth, a national online brokerage, a typical Obamacare-compliant plan pays a commission of around 5 percent, while short-term plans pay out commissions closer to 20 percent. Because short-term plans are currently limited to 90 days, brokers now make more money selling comprehensive plans that cover more benefits. But that math may shift as short-term plans expand their duration under the new rule, giving brokers a stronger financial incentive to sell short-term plans instead.” [New York Times, 8/1/18]

…and are designed to undermine access to affordable, comprehensive care.

Huffington Post: “The New Rules Represent One Of The Most Consequential Steps That President Donald Trump And His Republican Allies Have Taken In Their Campaign To Dismantle The 2010 Health Care Law Known As Obamacare.” [HuffPost, 8/1/18]

Washington Post: Making It Easier To Buy Plans That Circumvent The Law Part Of Trump’s Strategy To Undercut The ACA.“Making it easier to buy health plans that avoid the law’s protections is part of a strategy being employed by Trump and his aides of relying on executive powers to undercut aspects of the law, whose demolition has been one of Trump’s central goals since his 2016 campaign.” [Washington Post, 8/1/18]

San Diego Union-Tribune: Plans Are “Devised To Foster Low-Price Insurance That Circumvents The Affordable Care Act’s Coverage Requirements And Consumer Protections.” “The new rules are the second tool the administration has devised lately to foster low-price insurance that circumvents the Affordable Care Act’s coverage requirements and consumer protections. In June, the Labor Department issued rules that will make it easier for small companies to buy a type of insurance known as association health plans and, for the first time, allow them to be sold to people who are self-employed…Both can have bigger price differences between older customers and younger ones. But only the short-term plans can also charge higher prices to customers with medical conditions that require care, deny them coverage, or avoid covering health problems that a customer had before buying the insurance — all practices that the ACA bans.” [San Diego Times-Union, 8/1/18]