08.01.2018 / Press Release

Trump Administration Rule Deals Another Blow to People with Preexisting Conditions, Defying the President’s Promises to Improve Health Care and Lower Costs

Washington, D.C.—Today, the Trump administration released a final policy that threatens the health care and financial security of children, parents, and other adults. The final “short-term plan” rule issued by the Department of Health and Human Services allows insurance companies to expand the sale of junk insurance plans that do not cover essential health benefits or preexisting conditions, protections required under the Affordable Care Act (ACA). More specifically, the rule allows insurers to sell and market short-term plans, which currently may be sold only for a coverage period of 3 months, for periods of up to 364 days and renew them to last up to three years. View our analysis of the proposed rule.

Following is the statement of Families USA’s Executive Director Frederick Isasi:

“President Trump has broken so many of his promises to the American people about health care. Instead of providing ‘great health care for a fraction of the cost,’ as he promised, the administration continues to enact policies, like today’s ‘short-term plan’ rule, that will result in exactly the opposite: Families and people with preexisting conditions left entirely without coverage, left with meaningless coverage, or left with staggering health care costs and debt.

“With this new policy, coming on the heels of another harmful rule it issued in June that makes it easier to sell other forms of junk health insurance, the Trump administration is giving insurance companies the green light to sell meaningless health insurance to vulnerable families. These sham health plans can deny payment of medical bills for a range of common health care services—from maternity care to prescription drugs to treatment for mental health or substance use disorders—sticking consumers with the bill for care not covered by their plan. They are so full of fine print exclusions that even if a short-term plan seems to cover a service at first glance, when consumers read the fine print they will find the plan may not offer coverage for the service in many circumstances.

“By allowing for these plans to be offered for up to three years, the Trump administration is making a mockery of both the intent and the plain meaning of the legal exception for ‘short-term’ coverage. This is a brazen effort to evade the core insurance protections in the Affordable Care Act.

“Make no mistake: the Trump administration is endorsing the sale of health insurance in name only. They are returning us to the days of health insurance tricks at the expense of our loved ones. Most families and vulnerable people will have to pay much more to get the comprehensive coverage and health benefits they need. And sadly, many people who buy a short-term plan will have the rug pulled out from under them when they need the coverage most: when have a medical issue and learn that they’ve been tricked.

“Before the Affordable Care Act, hundreds of thousands of Americans a year declared bankruptcy because their health insurance didn’t cover critical services and, therefore, didn’t provide real financial protection. Since passage of the health law, the number of bankruptcies has been cut in half. This new short-term plan rule could cause thousands of families to face financial ruin when they are struck by illness or injury and discover their health plan does not protect them.

“Even healthy individuals who purchase short-term plans are vulnerable. If they have an accident or fall ill, like break a leg or get a bad case of the flu, they may find these plans provide little or no coverage for the services they need. Plans may even retroactively cancel coverage at the very time someone needs it most, potentially leaving the patient with massive amounts of health care debt.

“The consumers who buy these plans won’t be the only ones harmed by the Trump administration rule. These plans are likely to cause the price of comprehensive coverage to spike as healthier individuals and families exit the marketplace where comprehensive coverage is sold and instead buy these skimpy, junk policies. Older people and people who have been sick will find that real coverage becomes more and more unaffordable.”

-30-