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In a New York Times article this week, Robert Pear reported on a study done by the chief actuary of the Center for Medicare & Medicaid Services, which shows the devastating impact of expanding access to short-term, limited-duration plans, as proposed by the Trump Administration. According to the Times, the study finds that as many as 1.4 million people could enroll in these plans during the first year. The study also finds that these plans could increase federal spending by as much as $1.2 billion next year and $38.7 billion over ten years. These numbers are in direct contradiction to what the Administration has said about the number of enrollees and cost to the government.

Just last week, in a hearing on Capitol Hill, Health and Human Services Secretary Azar defended the Administration’s proposal on these junk plans. Azar is quoted as saying “…expanding short-term health plans will not harm the insurance marketplace.” He also stated that “People are not going to be leaving subsidized insurance,” even as repeated studies show the opposite to be true.

For months now, the Center for Medicare Advocacy has been highlighting the impact of these misguided proposals on the individual marketplace and on older and disabled consumers. These plans were never meant to provide long term insurance. At best, they serve as a stopgap coverage in limited situations. It is important to remember that this sort of short-term coverage has high out-of-pocket costs, doesn’t have to cover essential health benefits, may discriminate based on age or gender, may impose lifetime and annual limits, and doesn’t protect people with pre-existing conditions. In fact, one insurer specifies that “A pregnancy existing on the effective date of coverage will also be considered a preexisting condition.”  

While such plans will attract younger, healthier consumers, those who are older or disabled will face higher and higher costs – essentially being penalized for remaining in the marketplace, which, for now, will be the only place they can get the actual coverage that meets their needs.

Below are just a few of the reports that clearly show that these short-term plans will wreak havoc on the marketplace and give consumers a raw deal.

May 17, 2018 – B. Belton

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