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Short-Term Insurance Plans Will Hurt Patients, Senators Say

Analysis  |  By MedPage Today  
   August 17, 2018

Allowing the marketing of these short-term plans 'puts us at risk of going back to the pre-ACA era where women were left without the coverage they needed.'

This article first appeared August 16, 2018 on Medpage Today.

By Joyce Frieden

WASHINGTON -- Allowing insurers to sell short-term health insurance plans that are not subject to Affordable Care Act (ACA) coverage provisions will result in patients being unable to get coverage at a time they need it most, Democratic senators said Thursday.

"These policies are not going to be worth the paper they're written on," Sen. Ron Wyden (D-Ore.), ranking member of the Senate Finance Committee, said at a briefing on short-term health insurance plans called by a group of Senate Democrats. Wyden said that when he was running the Gray Panthers, a senior citizens' group in Oregon, group members successfully fought against allowing worthless Medicare supplemental insurance plans to be sold. "These junk insurance policies look like they may end up beating those ripoff Medigap supplements as one of the biggest ripoffs of our time."

Wyden read a question from an application for a short-term health insurance policy that was just approved for sale in the Midwest. Sales of the plans, which don't have to follow the ACA's coverage requirements, are now permitted under the new rules for short-term, limited-duration health insurance plans recently finalized by the Department of Health and Human Services (HHS). The rules allow such policies to last for up to 12 months, and they can be renewed for another 2 years after that. Previously, the Obama administration limited the policies to 3 months' duration.

"One of the [questions] reads, 'Within the past 5 years, have you or any other person to be insured been aware of being diagnosed, treated by a member of the medical profession, or taken [medication] for: cancer, tumors, stroke, a heart disorder, heart attack, coronary bypass or stent, peripheral vascular disease, carotid artery disease, chronic obstructive pulmonary disease, emphysema, a kidney disorder, liver disorder, a neurological disorder, a degenerative disk disease, rheumatoid arthritis, degenerative joint disease, diabetes, Crohn's disease, bipolar disorder, or any eating disorder, alcohol abuse, or chemical dependency, or does anyone listed on the application currently weigh over 250 pounds (for women) or 300 pounds (for men)?'" Wyden said.

Answering "yes" to any of those items could get you disqualified for coverage, he said. "That, folks, is not some kind of abstraction ... People ought to have airtight, loophole-free protection. What I read you doesn't exactly meet that test."

Constance Bohon, MD, legislative co-chair of District IV of the American College of Obstetricians & Gynecologists, said that as someone who has been a practicing ob/gyn for 35 years, "I have seen firsthand the negative impact that lack of insurance coverage has on the health of my patients. I have seen a patient with a risk for preterm birth not have coverage for critical preventive healthcare during her pregnancy, increasing her risk of having a preterm baby."

Allowing the marketing of these short-term plans "puts us at risk of going back to the pre-ACA era where women were left without the coverage they needed," said Bohon. "A Kaiser Family Foundation analysis found that, of 24 distinct short-term insurance plans currently marketed in 45 states and D.C., none of the plans included maternity care coverage. These plans will turn back the clock on women's health."

The event also included testimony from a patient who had been hurt by a short-term policy. Two years ago, Sam Bloechl, a self-employed landscaper from Chicago, began having lower back pain. He decided to see an insurance broker to get his health insurance coverage upgraded before he was diagnosed with anything serious.

"During the conversation I was very upfront about my problem," he said. "I told the broker I had been experiencing back pain since October and had been to the chiropractor numerous times. I shared that the chiropractor had taken x-rays, but he had not made a diagnosis. I told the broker I was still experiencing pain and that I would most likely be going in for an MRI in January. She assured me that as long as there was no diagnosis, the plan she recommended for me was the right plan."

Sam was eventually diagnosed at age 28 with stage IV non-Hodgkin's lymphoma; his doctors gave him chemotherapy and radiation and recommended a bone marrow transplant. However, "my insurance company told me that they would not pay for any of my treatment," including the transplant, he said.

Bloechl appealed the decision but was denied, leaving him with $800,000 in medical bills. The insurer said the cancer was a pre-existing condition because he had already been to see a chiropractor about his back pain before getting the new insurance. "Instead of planning a life together with my fiance and a future for my business, I am kept up at night worrying about staying afloat, how to pay the next bill, how to avoid bankruptcy."

Baldwin and Sen. Elizabeth Warren (D-Mass.) who also attended the briefing, are among six co-sponsors of S. 2582, the Consumer Health Insurance Protection Act of 2018, which would require that short-term insurance plans cover the 10 essential benefit categories included in the ACA. The bill was introduced in March, but no other action has been taken on it.

HHS Secretary Alex Azar defended the short-term health plans in an opinion piece in Thursday's Washington Post. He pointed out that the plans will cost 50% to 80% less than other plans and that "consumers can also buy separate renewability protection, which will allow them to lock in low rates in their renewable plans even if they get sick."

"These short-term plans can be a good option for many Americans priced out of Obamacare's regulations -- especially small-business owners, independent contractors in today's 'gig economy,' and younger Americans transitioning between school and employment," he wrote. "Fundamentally, this administration believes in more options, not fewer, for consumers. Expanding short-term insurance is just part of President Trump's larger agenda to improve healthcare choice and competition for Americans."


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