Trump administration finalizes expansion of short-term health plans


Previously, under the Affordable Care Act, short-term plans were limited to three months.

In response, Obama-era health officials in 2016 restricted the short-term policies to three months.

"For many who've got pre-existing conditions or who have other health worries, the Obamacare plans might be right for them", Health and Human Services Secretary Alex Azar told "Fox & Friends" on Wednesday.

But patient advocates and health policy experts argue that these policies provide only skimpy coverage and will undermine the Affordable Care Act.

"The Administration's actions raise questions that go to the heart of our structure of government: whether the executive branch must 'take care that the laws be faithfully executed, ' U.S. Const. art. II, § 3, and whether the Constitution therefore prohibits the President and his appointees from wielding executive power to destroy a duly-enacted law", the complaint states. In Q4 of 2016, the average monthly premium for an individual beneficiary for a short-term, limited-duration plan was $124, compared to almost $400 for an unsubsidized individual market plan.

Have you ever had a short-term insurance policy?

Also, unlike the so-called Obamacare plans, the short-term plans can deny or limit coverage based on an individual's medical history. Typically, they don't provide free preventative care or maternity, prescription drugs and mental health benefits. But they may have higher out-of-pocket costs, as well as yearly or lifetime limits on coverage forbidden by the ACA.

Short-term plans are cheaper than ACA plans. Even worse, not having it at all and forgoing preventive care as well as needed prescriptions and treatment?

The goal was to ensure that everyone has access to quality health coverage without discriminating against those who have pre-existing medical conditions.

Administration officials estimate plan premiums could be half the cost of the more comprehensive ACA insurance.

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The lawsuit also includes a list of Trump's tweets in which he indicated intent to sabotage the law by referring to it as "a broken mess" and expressing a desire to "let ObamaCare implode" to usher in a new healthcare plan. This could have the effect of driving premiums slightly higher on the ACA exchanges, because healthier people will leave the market, according to the CBO.

During the Obama administration, health officials became concerned that, as premiums for ACA health plans were becoming more expensive, some people were starting to rely on these alternatives as an end-run around the comprehensive coverage the law was created to promote.

"These policies are different from those offered on the exchange", said James Parker, a senior adviser for health reform at HHS, in a conference call with reporters. "These policies will not necessarily cover the same benefits or extend coverage to the same degree". In fact, these plans look a lot like the often all-but-useless private health plans that littered the individual market before the ACA reined in predatory and discriminatory insurance industry practices.

Insurers must prominently display in the application and contract that the plan lacks many ACA protections.

Enrollees who get injured or sick are likely to return to the ACA's guaranteed-issue market at open enrollment and buy a plan that covers their condition, further weakening the ACA market. Also, 300,000 people who now buy individual market polices outside of the Obamacare exchanges will switch to short-term plans and another 100,000 uninsured folks will purchase them next year.

It's unclear how that might happen, since versions of such plans have always been available - including during the Obama administration. The administration says it expects about 1.6 million people to pick a short-term plan when the plans are fully phased in.

That's the claim being made by four USA cities - Baltimore, Chicago, Cincinnati and Columbus, Ohio - in a lawsuit against the president filed in federal court Thursday. But that lower cost comes with another price.

Today the Trump administration issued a final rule allowing insurers to sell "short-term, limited-duration" health insurance policies that can last up to three years instead of the maximum allowable three months under current rules. No one is above the rule of law, including the U.S. President.

Health insurance brokers, who had seen their role diminish under the ACA, welcomed the new rules to expand the use of short-term plans.