The departments of Health and Human Services, Labor and Treasury announced new rules Wednesday that make it easier for consumers to replace ACA insurance with these short-term policies.
"There are many lawsuits and consumer complaints around the country stemming from unpaid bills" resulting from the short-term plans, Richard Besser, president of the Robert Wood Johnson Foundation, the biggest US health philanthropy, said in a letter to the administration opposing the expansion of the plans. But only the short-term plans can also charge higher prices to customers with medical conditions that require care, deny them coverage, or avoid covering health problems that a customer had before buying the insurance - all practices that the ACA bans.
The Centers for Medicare and Medicaid Services, or CMS, released a final rule that will expand short-term health insurance plans, a move that the administration said will help more people access cheap insurance options.
The plans don't have to comply with Affordable Care Act rules including: coverage of essential benefits; prohibition against medical underwriting; limits on premium variations based on age, sex or health status; elimination of annual and lifetime benefit caps; annual limits on out-of-pocket costs; and the requirement that plans spend no more than 20% of premiums on administrative costs and profit.
"We make no representation that it's equivalent coverage", said Jim Parker, a senior adviser at HHS.
They are suing to force the administration to restore the funding that was slashed for outreach and enrollment assistance, extend the 2019 open enrollment period, and steer people towards comprehensive ACA plans and away from skimpy short-term plans that do not cover pre-existing conditions.
They do not satisfy the ACA's requirement that most Americans carry health insurance.
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. State regulators told the administration that they've received complaints from consumers about the plans failing to cover their treatments. 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. 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. Because it is law, the President of the United States, being that he is expected to "take care that the laws be faithfully executed", must not take actions which circumvent, curtail or break this law.
Officials hope the plans will appeal to people ineligible for income-based subsidies under the Affordable Care Act.More news: Thomas doesn’t break sweat in winning finale at Firestone
Short-term policies are available now, but consumers can only buy them for up to three months.
"The broader availability and longer duration of slimmed-down policies that do not provide comprehensive coverage has the potential to harm consumers, both by making comprehensive coverage more expensive and by leaving some consumers unaware of the risks of these policies", said Senator Ron Wyden in a statement to Politico.
More than 9,000 people and organizations commented on the rule, since February when it was first proposed.
"These junk plans can refuse to cover pre-existing conditions, mental health, substance use services or maternity care", said Sen.
The other ways they keep their premiums down is by offering bare-bones coverage in the first place.
Since Congress failed to repeal the Affordable Care Act past year, President Donald Trump has attempted to weaken the program through eliminating protections, discouraging enrollment, and driving up costs, the lawsuit argues.
57% cover mental health needs.
"It's very much buyer beware".
Letsos, too, said all she wanted was an option to buy a plan she liked.
Schumer said Democrats will introduce a resolution to rescind the rule using the Congressional Review Act, which allows Congress to revoke an administration regulation with a simple majority any time up to 60 legislative days after it is published in the Federal Register.