Groups Caution Against ???Junk??? Insurance Plans
A new rule announced by the Trump administration could expose Americans shopping for health care coverage to new risks.
The short-term plan rule allows insurance companies to expand the sale of so-called junk insurance plans that don’t comply with all the benefits considered “essential” under the Affordable Care Act.
Cheryl Fish-Parcham, director of access initiatives for the health care advocacy group Family USA, points out patients can be denied coverage for maternity care, prescription drugs and mental health conditions to name a few. She notes the plans are full of fine print exclusions.
“There are many instances where people have bought these plans only to find out that there was no network of providers in their state to actually provide care,” she explains. “Or they were denied care due to a preexisting condition. These just are not very protective plans.”
The new rule will allow short term plans to be sold for up to a year, compared to just three months under current rules.
President Donald Trump says the plans will offer “much less expensive health care at a much lower price.”
Sales of short term plans will be allowed starting in early October, just weeks before the open enrollment period begins for the Affordable Care Act.
Sarah Lueck, a senior policy analyst with the Center on Budget and Policy Priorities, says there are concerns the timing will cause even more confusion.
“The worry is that consumers, at the very moment when they should be looking at the marketplace – seeing what they might be eligible for and being able to get comprehensive coverage that does protect people with preexisting conditions – they’ll instead be sort of lured away by very aggressive marketing of short term health plans,” Lueck states.
Fish-Parcham notes despite the federal rule changes, states can set their own standards for short term plans.
“They could ban them entirely,” she states. “They could restrict their sale. They could make sure consumers get adequate notice beyond what the rule itself requires. They could do a lot to further regulate these plans.”
Maryland and Vermont have passed laws that limit short term plans to three months or less. Similar legislation regulating the plans is pending in Hawaii and Illinois