New York Estate Planning & Elder Law Blog
The country’s largest trade group for health insurance companies is sounding the alarm on proposals from President Trump that would expand the sale of plans that cover fewer services to people who cannot afford some of the current short term plans. America’s Health Insurance Plans (AHIP) claims the proposal would lead to more Americans becoming uninsured or underinsured, resulting in higher healthcare costs in the future.
The rule proposed by the Trump administration would lift restrictions from the previous administration that limited short term health insurance coverage to a maximum of three months and allow individuals to purchase short-term health insurance for up to one year. The administration claims the move would create an alternative for those unable to afford plans compliant with ObamaCare covering a comprehensive list of services.
Opponents of the plan say the rule changes would mean insurance companies could end up charging individuals with pre-existing conditions more for their health care coverage, a major restriction placed on companies under current statutes of the Affordable Care Act (ACA). Instead, members of the AHIP suggest the short term health insurance plans be limited to only six-months of coverage, ensure clear disclosures to consumers about what short term plans do and do not cover, and inform consumers of the potential availability of discounted coverage through the marketplace.
An analysis by the Kaiser Family Foundation showed some of the coverage gaps these short term health care plans could face. Some of those include the plans being medically underwritten, can exclude patients for pre-existing conditions, do not cover essential health benefits, and can impose lifetime and annual coverage limits. The analysis also determined that out of two dozen short term insurance plans offered in 45 states, 43 percent do not cover mental health services, and 62 percent do not cover substance abuse treatment.
Another 71 percent do not cover outpatient prescription drugs and none of the plans covered maternity care. The upside for consumers, however, is that these plans are also about 20 percent cheaper than the lowest cost bronze plans available through the Affordable Care Act marketplace for patients in the same location. The Kaiser report believes the combined effects of repealing the individual mandate penalty from the ACA and the current administration’s efforts to promote the sale of short-term plans could result in fewer people signing up for ACA compliant plans and result in higher premiums.