Slowly but surely, President Biden is repairing the U.S. health-care system, reversing Trump-era sabotage and ensuring millions more Americans get access to affordable coverage.
The latest of these efforts came on Friday, in a little-noticed but significant decision to protect Americans from junk health insurance.
In 2017, Congress repeatedly tried and failed to repeal the Affordable Care Act. To casual observers, it might have looked like the end of the Republican fight to kill this lifesaving, inequality-fighting, newly popular law. It wasn’t. Over the next few years, President Donald Trump found new ways to sabotage the health-care system and its protections for the most vulnerable Americans.
Among the most insidious of these backdoor repeal measures: expanding “short-term, limited duration” health plans — i.e., attempting to trick Americans into plans that looked cheap but basically covered nothing.
Short-term plans are theoretically intended as brief, stopgap coverage — say, to tide over a new college grad whose job doesn’t start until the fall.
They’re relatively unregulated; they don’t have to cover minimum care benefits guaranteed by Obamacare and other major legislation, for example. A 2018 analysis found that most don’t cover maternity services, substance-abuse care or prescription drugs.
These plans can also deny coverage for care of preexisting conditions, even if the preexisting condition in question hadn’t yet been diagnosed at the time the person enrolled.
People often don’t realize they’ve bought a worthless product until it’s too late — when they get hit by a bus, say, or are diagnosed with a brain tumor.
Such loopholes might seem like no big deal until you find yourself falling through one. The Trump administration made sure more people did by allowing these allegedly short-term plans to last as long as 364 days, rather than the three-month max that had been in place, and to be renewed for up to three years.
This made them look a whole lot like regular plans. Plus, because short-term plans are mega-profitable for insurers, brokers can get much larger commissions for steering hapless customers into them. So, many did.
Exactly how many were lured by this policy change is unclear; the data is lousy, precisely because these products are so unregulated. A recent estimate from the Urban Institute ballparked the number of people enrolled in individual plans that are noncompliant with Obamacare protections at 2.5 million.
The proliferation of short-term junk plans affects even consumers who don’t get duped by them. That’s because these cheaper plans disproportionately siphon healthier (i.e., lower-cost) people out of the broader individual insurance marketplaces. People who have chronic conditions or otherwise know they will need more substantial coverage are more likely to stay in the regular marketplace pool, driving premiums there ever higher.
Last week, however, the Biden administration announced a rollback of this Trump-era expansion of short-term health plans.
In a proposed rule, Biden officials said those already in these skimpy Trump-blessed plans can continue in them, if they so choose. (“There were some hard lessons learned from the ‘if you like your plan you can keep it’ blowback a decade ago,” surmises Georgetown University health scholar Sabrina Corlette.) But going forward, any new “short-term, limited duration” plans would need to be truly short-term (up to three months) and truly limited-duration (renewed for up to one additional month only).
Critically, short-term plans must also provide clearer language about what care they do and don’t cover, and under what circumstances. People who choose to buy junk must know upfront that they’re buying junk.
The White House has marketed this rule as part of “Bidenomics,” though it might be more easily understood as simply pro-consumer. It also dovetails nicely with other actions the administration has taken to expand access to coverage, including outreach to encourage eligible Americans to enroll in marketplace plans and patching the so-called family glitch (a regulatory accident that had blocked a lot of families from accessing subsidized health coverage).
Most important, through last summer’s Inflation Reduction Act, Biden extended the enhanced premium tax credits available for plans on the individual marketplace.
This has meant that millions more Americans can get solid health-care coverage that not only is affordable but also, in many cases, has an out-of-pocket premium of zero dollars. And unlike with those junk insurance plans, the low price tag here isn’t a red flag; these plans actually do provide comprehensive coverage, including for people with preexisting conditions.
It’s not a bait-and-switch. It’s a real subsidy — and one that will likely drive down premiums overall, on average, by drawing more healthy people into the broader marketplace risk pool.
Our health-care system is still kludgy. It still allows too many Americans to fall through the cracks. But small unsung fixes such as this are achievements worth celebrating.
Holy shit, I lean pretty solid left, but damn this is some propaganda. I’ll start by saying that I truly believe that our country should provide universal healthcare, but the ACA ain’t it. I work in health insurance and the ACA plans have significantly more problems than any “junk” plans out there. Here’s a few examples from personal experience:
Inaccurate provider directory - ACA carriers may show a doctor/hospital as in network during the open enrollment period, then 3 or 4 months later when the person goes to use the plan they find out the directory was wrong. At that point, since we’re outside of the open enrollment period they are basically screwed and have to pay out of pocket to continue to use their preferred facilities.
Customer service - good luck getting someone from any ACA carrier on the phone. Any time there is an issue it’s a jerk around fest getting someone that has any ability to help whatsoever. On top of that, you’re going to have to go through 3-4 individuals that are clearly English as a Second Language before they transfer you up the chain to someone that can actually understand your problem and assist in any meaningful way.
Network - Good luck trying to get coverage if you’re traveling out of state and have an accident or get sick and need to see a doctor. What if you want to travel across the country to go to the best doctor for your condition. You just flat out can’t use it, they won’t take it.
Network part 2 - The vast majority of plans are either HMO or EPO. Let’s say you’re on an HMO and have a health condition where you need to see a specialist regularly. You need to go to your primary care for a referral EVERY SINGLE TIME you need to go to that specialist. With EPO’s you can skip that referral step, but good luck getting an appointment in any sort of reasonable timeframe. It usually takes 3-6 months to get in for your first visit, and then another 1-2 months to get an appointment every time you need to see that specialist.
Network part 3 - None of the top facilities accept any ACA plans. Say you get cancer and want to go to the Cleveland Clinic as they are the best at what they do. Flat out can’t go there, they don’t take it. This goes for Cleveland Clinic, Mercy, Baptist, DiMaggio, etc.
Dropping coverage - Carriers will drop your coverage out of nowhere with no explanation or notice they are doing so. The individual only finds out when they go to use the policy, and they’d better hope that they’re not trying to use it for anything serious cuz the carrier/marketplace will do absolutely nothing to help you.
Step Therapy - Let’s say you take an expensive specialty medication that is the only thing that provides any relief from your health condition. Well, every single time the calendar flips to a new year you have to go through Step Therapy. That means that you have to try a generic medication and prove it doesn’t work. Then more than likely a second generic medication. Then you have to try a brand medication and prove it doesn’t work. Then more than likely a second brand medication. Then you can maybe get your specialty drug, but only if it’s on the carrier formulary.
Insolvency - Each of the past two years there has been an ACA carrier that has gone belly up. Last year it was Bright Health, this year it’s Friday Health. Imagine picking a plan, going through the hoops of finding a doctor that actually takes it, meeting some or all of your deductible, and then the carrier disappears mid year. You’ve just lost all of the money you’ve contributed towards your deductible and have to start the entire process over again of finding a new plan. Yeesh. I didn’t know it was possible for any insurance company to go out of business, but 2 years in a row it’s happened.
Unnecessary Coverage - Does a 60 year old woman really need maternity? Does someone that’s never been to nor ever intends to go to a psych need mental health coverage? Does someone that has never taken a drug or drank alcohol in their life need substance abuse coverage? Those are rhetorical questions, but the answer is an overwhelming no. Yet they have to pay to have that as part of their plans even if they’ll never use it.
There’s a lot more that I could list but these are the major ones that come to mind right off the bat.
The only issues I’ve ever had with Short Term plans is people lying on an application and not disclosing they have a Pre-ex. Other than that, no issues whatsoever. They offer better coverage, better pricing, better networks, better customer service, pay claims faster. The pre-ex thing is literally the only downside.
Look, our health insurance system is fucking terrible across the board, whether it’s ACA or anything else or there. Healthy people that want a nationwide PPO with lower premiums and access to the best facilities in the country should be able to purchase those plans. No, the plans do not cover pre-existing conditions. No, they do not have all of the Minimum Essential Coverages. But if someone does not have a pre-ex, and doesn’t need the MEC’s, why should they be forced to pay more for worse coverage. Removing choice is not the way to fix our system.
And what happened to personal responsibility? If someone ends up with a “junk” plan that means that they did not do their research, did not ask the right questions when being sold a policy, did not read their policy documents, etc. All it takes is a quick google search to find out what you’re buying, and for something as important as health insurance, where is the responsibility of the individual to do their own research?
I’ll tell you right now, the people that are on short term plans generally love them, and the people on ACA plans generally hate them. This is just going to push people to even shittier fixed indemnity or cost share plans which are the worst things out there.
The real reason this is happening is that only the sick and low income individuals are on ACA plans. The carriers need more healthy people and those healthy people want better coverage, which Short Term plan offer. Let’s make the ACA better instead of making our options worse.
Edit: Typos and clarification
Edit: did the person who took the time to quote my comment, for which I replied to every one of their points delete their comment killing the thread of my response? Wow, glad I took the time to refute their objections. I guess adding the exchange was too much text for one comment so here’s a gallery of the screenshots: https://imgur.com/gallery/Ons2spb
Under the ACA that is not allowed. But they can drop you if you have short term junk insurance.
I was on for 2 years and it was pretty good. They had the best drug plan ever. Most drugs cost me $0. Even ones that normally cost $100+ in other plans.
Bullshit. Anyone who (1) is not in an employer plan and (2) does not want junk insurance with bad coverage has these plans and is very glad to have them.
This does not happen unless you choose a different insurance. Same as employer insurance or your junk insurance.
A 60 year old woman never pays for “maternity”. Plans price their premium by age. They know a 60 year woman won’t need maternity, but will need a lot of other expensive coverage a 30 year old probably won’t. Therefore, the 60 year old woman is charged a ridiculous rate.
Less likely for ACA
I had great customer service on ACA.
You listed 9 things and only 1 out of 9 (network coverage) was a real issue specific to ACA. And that is just because the plans are new.
Well sure. Subsidies should be increased etc. Better yet, Medicare for All.
Upvote for answering and refuting, that’s the best way to learn and understand the reality of shit. It’s late and I will be back in the am with a reply
Here’s the reply edit:
As a baseline for all of my answers, I’ve been in the health insurance business for over 5 years in which time I’ve assisted over 3,500 individuals with their health insurance needs. I consider myself an expert in the topic and every response is based on personal experience.
I field at least one call a week from someone that has gone to use their policy with an ACA carrier to find out that the policy has been terminated. The most common reasons are legitimate; failure to make premium payment or failure to submit required documentation. However, in most (not all) instances the carrier fails to notify the individual that there is an issue so they have no idea their coverage has been terminated.
There have also been an overwhelming number of occasions that the coverage has been terminated and there is no explicable reason why it has happened. You are correct that the ACA cannot legally “drop” coverage, but it happens all the time. I have never once seen a Short Term policy terminated for any illegitimate or unknown reason, and if terminated, the client and the agent are always notified of the termination. This is just simply not the case when it comes to ACA, it always seems to be a surprise.
It’s great that you’ve had a good experience, and a lot of people do. I’m not suggesting the ACA is terrible, just that there are a number of issues that get completely glossed over when shitting on the other options out there. Forcing people into one specific type of plan without recognizing the faults to those plans is disingenuous at best.
In regards to the medication you are referring to, of course it worked as advertised, it’s pretty inexpensive in the grand scheme of things. If you look back at my comment regarding prescriptions, I’m referring to specialty drugs that have retail prices in the thousands of dollar range. The type of drugs that are required for individuals to survive.
Bad coverage is a subjective term. As previously stated, my experience is that the people with what you would consider “junk insurance” prefer them pretty heavily to the options available through the ACA. The whole point is choice, and removing the option for individuals to go outside of the ACA is eliminating that choice.
To expand on my prior comment about sick and low income individuals, I guess you just have to take my word that the majority of the individuals that I work with only go to the ACA if they are not healthy enough to qualify for underwritten health insurance policies, or if they get a huge subsidy making the premium lower than it would be otherwise.
Again, the step therapy refers to very expensive medications, and yes the ACA insurance carriers make you go through that process each and every year. They flat out do not want to pay for the drugs and this is their way of attempting to get you to use something less expensive.
The whole point of my comment is to state that going through the ACA does not provide the ability to customize coverage to reduce cost. Again, eliminating choice.
Well, it’s happened each of the past 2 years, so I guess it is pretty likely. In my career in the business I’ve literally never seen a private insurer go insolvent, but I’ve seen at least a half a dozen ACA carriers disappear. Some of them have been smaller, regional carriers, but Bright Health and Friday Health were nationwide carriers that went insolvent.
That’s great and I’m glad you were able to get assistance. That’s not the case for most people.
Obviously I didn’t just pull these issues out of thin air. You are basing your answers on your own personal experience for 1 person (or maybe 1 family). I’ve got experience with 3,500 individuals and every issue or concern they’ve ever had, and for me it remains 9/9. The quite literal only downside to Short Term Insurance is the denial of coverage for pre-existing conditions. That’s it. One issue. And people with pre-existing conditions should not be on those types of plans.
Not sure what you mean by this. The ACA has been around since 2010 meaning this year’s open enrollment will be the 14th on record. The plans are not new by any stretch of the imagination. They’ve also gotten considerably worse over time with higher deductibles, higher copays, higher max out of pockets, more limited networks, etc.
I’m not saying that Short Term Insurance, what you consider “junk plans” is the best option for everyone out there. It’s just not anywhere near as bad as the Biden administration is making it out to be. Give people the option, let them decide what they think is the best fit for their situation and budget.
Sure, a ton of the Obamacare plans are straight up awful or a waste of money, but the Medicaid expansion was really good (for the states that accepted it). The singular portal for applying for Medicaid is also a vast improvement, simplifying things for patients in general. As you said, the health insurance system is terrible across the board, ACA plan or not; the only real way to change that is to have a public option at minimum.
Yeah, the title “Biden is quietly reversing…” etc feels like Biden’s playing whackamole while someone is literally dying of a heart attack next to him. But the ACA did more than just establish the ACA Marketplace.
All ACA plans have the same basic coverage. That’s how the law works. That is one of the great advantages, is that you don’t have too closely study the fine print, cross your fingers, and pray to Moluch that you will get the things covered that you need. The main difference is deductable and premium cost.
I mean, I think deductibles and premium costs matter a lot, don’t you? A lot of people don’t really understand those things, and it can be a shock to find you have to pay a $2000 deductible before any kind of insurance kicks in.
Downvote, because it’s not just that I disagree with pretty much every point, but any time someone restore to victim blaming
It’s one thing to do research and weigh options to determine the best out of multiple reasonable choices, but not whether you’re getting ripped off or not. Are we really ok with health insurance being similar to email from a “Nigerian Prince”?
It’s victim blaming to suggest someone should make an informed decision when it comes to something as important as their healthcare?
I’m copying from another one of my comments
So what is the solution? Scrap ACA entirely, modify it, improve it, something else? I feel like a public option that is reasonably priced to compete with private insurers and providers is a more actionable option. Disclaimer though, I fully admit I don’t understand healthcare or insurance AT ALL and I only skimmed your post, sorry.
Scrap it entirely and do what the rest of the civilized world does and provide universal healthcare with the ability to supplement with private insurance. That’ll put me basically out of a job, but that’s what needs to be done.
My true solution would be the government offering everyone a social safety net for catastrophic events, something like a $20,000 cap on medical bills lifetime, and then pay cash for everything else. That way doctors and hospitals will actually have to compete for our business, true free market, where the quality of service will increase while out of pocket costs decrease. The only area of healthcare where this has happened is with elective services (lasik, tits & ass, lipo, etc) because the doctors are competing for your business. For people with health conditions have them apply for Medicaid.
European chiming in here, which explains my totally communist/socialist viewpoint, I call bullshit. There is no healthcare ‘market’. When a person falls ill, they have no time/energy to seek out the highest quality/most cost-effective hospital or healthcare professionals. They turn to the one that is closest by and specialised in their ailment.
Just like there are no markets for housing, energy, water, public transport and all the other public services that just require deep public investments. These services do not need to make a profit, precisely because profit seeking takes away the investment capacity. This seems to be so hard to understand for folks in the US, I guess the decades long propaganda has taken its toll.
And yes, if one needs a lipo or a breast implant… For sure, that’s a market. As these are completely unnecessary, demand based services.
I’m not referring to issues that require immediate attention. Of course if you need to get something taken care of right away you can utilize the public health insurance to get that taken care of.
In addition, with the type of system I suggest, there wouldn’t be a need to “price shop” as the market would drive prices down and determine a standardized cost of service. If you get sick and go to a doctor and get charged some price that is above market standard, you’re sure to remember that and go to a different facility the next time around.
I am of the firm opinion that health insurance carriers should be not-for-profit companies. That also goes for hospitals and other types of health facilities. I definitely agree with you on this.
The left needs to pool some money together and create a new insurer. Create a network of doctors that’ll work below market rate (but not obscenely so), and make sure the organisation is eligible for debt forgiveness under the PSLF.
Only prescribe generic medicines, focus on preventative medicine and diet as much as possible, do all the stuff government run systems do elsewhere.
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I love how absolutely tone deaf and American this take is.
we shouldn't give people the tools to help prevent issues, instead we should blame them when they make decisions based on information that _wasnt_ provided to themThe tools exist. Google.com, brochures, carrier websites, policy documents, member portals, physical packets snail mailed to their house. There are multiple ways to look into the things that are being offered to you, and multiple ways to review the policy after the fact. My favorite type of prospect is someone that has done their research, knows what they want, needs me to answer a few basic questions, and assist them in submitting an application.
I’ve never offered a client a policy that was not a good fit for them. It screws them over and makes my job harder. Agents have to be licensed to offer policies, with a 20 hours continuing education course every 24 months, annual ACA compliance certifications, $1 million error and omission insurance. There are also very accessible avenues to report bad actors, and complaints are taken very seriously by the department of insurance. I wish the police had as much scrutiny to to wear a badge as health agents have to carry a license. Nobody is in this career to fuck people over, it’s too easy to lose your license and your livelihood.
The whole issue of “junk plans” is completely overblown. I said it in a previous comment, this change isn’t to protect consumers, it’s to eliminate the ability for healthy people to go with anything other than employer or ACA coverage (which both happen to be offered by the same carriers btw). The marketplace carriers NEED healthy people to start buying plans, otherwise the whole thing is going to fall apart. There’s just currently way too many claims in proportion to the total number of insured. The carriers cannot survive this much longer.