Trump restores rules allowing Obamacare alternatives with pared down 'short term' coverage

Henrietta Strickland
August 4, 2018

But behind these somewhat comical linguistic gymnastics lie some very real dangers for patients, especially those with chronic health conditions.

Four cities filed a federal lawsuit Thursday against the Trump administration, claiming the president is intentionally undermining the Affordable Care Act and violating a Constitutional duty to "faithfully execute" existing law. All have warned that consumers with bare-bones plans would be stranded when they need care - and that the defection of low-priced customers from ACA marketplaces would drive up prices for those who remain.

Officials say the plans can now last up to 12 months and be renewed for up to 36 months. They can include dollar limits on coverage, and there's no guarantee of renewal.

The expanded plans will be able to go on sale in two months, or as long as it takes for state regulators to approve them.

Officials are hoping short-term plans will fit the bill. More short-term plans will be available starting this fall. According to NBC News, 3 million fewer people had health insurance in 2017 compared to the year prior, and city-subsidized health centers in Columbus saw nearly 3,000 more uninsured patients.

HHS Secretary Alex Azar sees things a bit differently, promoting Trump's vision for cheaper, short-term insurance plans. Asa result, any enrollee who develops a terminal or chronic condition or who has a premature child is left unprotected from catastrophic costs.

Most short-term plans don't cover maternity care, outpatient prescription drugs, and substance abuse or mental health treatment, or they impose tight limits on these benefits; they can refuse to pay for treating conditions they consider pre-existing.

The Affordable Care Act has been under assault by the Trump administration for more than a year.

"To restore these to 364 days - as originally drafted - is exactly what we are looking for", said Jan Dubauskas, general counsel for the IHC Group, speaking before the final rule was released.

Both supporters and critics of short-term plans say consumers who do develop health problems while enrolled could, in theory, hang on until the next open-enrollment period and buy an ACA plan during the sign-up period because the ACA bars insurers from rejecting people with preexisting conditions. "These policies are not qualified health plans", Parker said, referring to insurance that meetings ACA standards.

Azar said the new plans are tailor-made for the 'gig economy'. The move allows small businesses and the self-employed to join together based on their industry or location and purchase health insurance through association health plans.

"It's a way better alternative to not being insured", said Jeff Smedsrud of Pivot Health.

The complaint further alleges that the administration has shirked oversight of insurance rate increases and reduced rebates to consumers, in an effort to raise premiums, create uncertainty, and cause insurers to flee the markets.

Association for Community Affiliated Plans CEO Margaret A. Murray said in a prepared statement: "Fake insurance is no substitute for real coverage".

However, these plans also don't have to adhere to all of Obamacare's rules, particularly the one requiring insurers to offer comprehensive coverage.

These policies are aimed at people who earn too much to qualify for federally subsidized health plans, a population HHS estimates will likely be about 200,000 people next year but could grow up to 1.6 million by 2024, according to Kodjak.

They also argue that they're just another way for the administration to undercut the Affordable Care Act by enticing healthy people from its markets and causing premiums to rise even more for those who remain.

Other reports by Click Lancashire

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