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NEW Report: GOP-Backed Junk Health Plans “So Skimpy That They Offer No Meaningful Coverage”

Republican Senators voted to uphold reckless proposal expected to lead to 600,000 more Americans on junk health insurance plans

A must-read report from Bloomberg today reveals the devastating consequences of Senate Republicans’ support for dangerous junk health insurance plans. Senators Cory Gardner, David Perdue, Joni Ernst, Mitch McConnell, Thom Tillis, Lindsey Graham, and John Cornyn all voted to uphold a reckless proposal to expand these junk plans, which threaten to send health care costs soaring and aren’t required to cover people with pre-existing conditions.

This latest indictment of the GOP’s toxic health care agenda comes as top Republicans are “vowing to try again” to tear down the health care law and its protections for millions of Americans if they regain total control of Washington in 2020, and as GOP Senators are still refusing to take a stand against their party’s lawsuit to gut coverage protections for pre-existing conditions, maternity care, and allowing kids to stay on their parents’ insurance until age 26.

IN CASE YOU MISSED IT

Bloomberg: Health Insurance That Doesn’t Cover the Bills Has Flooded the Market Under Trump’

Zeke Faux, Polly Mosend, and John Tozzi 

September 17, 2019

Key Points:

  • [The] 2010 Affordable Care Act… bars insurers from capping coverage, canceling it retroactively, or turning away people with preexisting conditions. But the law includes an exemption for short-term plans that serve as a stopgap for people between jobs. The Trump administration, thwarted in its attempts to overturn the ACA, has widened that loophole by stretching the definition of “short-term” from three months to a year, with the option of renewing for as long as three years.
  • Fewer than 100,000 people had [short-term health insurance] plans at the end of last year, according to state insurance regulators, but the Trump administration says that number will jump by 600,000 in 2019 as a result of the changes. Some brokers are taking advantage, selling plans so skimpy that they offer no meaningful coverage.
  • Six months after David’s surgery, the Diaz family got a particularly big surprise bill—an error, Marisia thought when she saw the invoice. But when she called her insurer, she was told she’d have to pay the full amount: $244,447.91.
  • The ACA was designed around a fundamental economic bargain: Insurance companies would no longer be allowed to deny coverage to people who were already sick, and policies would have to cover a broad set of benefits, including prescription drugs, maternity care, and hospitalization. In return insurers were guaranteed that consumers would buy coverage or face tax penalties, and that subsidies would be available for people who needed them. The approach spread the financial risk of getting sick and aimed to guarantee that no one with insurance would have to worry about being bankrupted by necessary care. Preserving the bargain was essential, though; too many exceptions, and the edifice would crumble.
  • When the Republican-controlled Senate failed in 2017 to pass Trump-backed legislation that would have gutted the ACA, the administration instead seized on the loophole allowing consumers to buy certain noncompliant plans. Trump used an executive order to extend the time limit for temporary plans, which he and other Republicans talked up as a potential solution for cash-strapped consumers. Healthy people, they argued, could save money by buying policies that didn’t cover perceived nonessentials.
  • Aetna Inc. and some other big insurers had been dropping off the state exchanges created for consumers to buy compliant plans, leaving a void that “junk insurers,” as critics tagged them, rushed to fill. A recent study by Sabrina Corlette, a research professor at Georgetown University’s Health Policy Institute, showed that ads for such plans often appeared at the top of internet searches for the government-run marketplaces. Health insurance also became the most common product pitched in robocalls—responsible, according to call-blocking service YouMail, for 387 million calls this April alone.
  • Surrano saw insurers behaving badly long before Obamacare, but he credits the Trump administration with the abuses being perpetrated today. “Creating an exception to the requirements of Obamacare is what gave rise to this kind of stuff,” he says. “This is what you get…”

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