Consumer Watchdog says “junk” health plans could leave patients on the hook for unlimited medical bills.
When President Trump on Thursday signed an executive order encouraging expanded access to association health plans and short-term, limited-duration plans, medical and consumer advocacy groups issued a flurry of reactions to the move — most of them negative.
Perhaps the sharpest rebuke came from Consumer Watchdog, which predicted the executive order could turn back the clock to days when patients faced unlimited medical bills, even when they played by the rules.
The group had spoken against similar proposals in the past, which would have allowed for the sale of policies that promise lower costs but would have delivered what the group called “junk health insurance plans” that can leave patients wihh hundreds of thousands of dollars in medical bills.
The nonprofit agency has worked with patients who bought such plans, subsequently banned by the Affordable Care Act, that left them near bankruptcy. Federal legislation by Sen. Mike Enzi to create such a market beyond the reach of state laws was rejected early in the 2000s.
Trump’s order also drew ire from the American Diabetes Association, which said Friday that the action jeopardizes access to adequate coverage and could increase healthcare costs for anyone with a pre-existing condition, including diabetes.
The executive order directs the Secretary of Labor to expand access to association health plans, potentially allowing for their sale across state lines. Allowing the expansion of such plans, in the ADA’s view, could mean the proliferation of coverage that does not provide the essential benefits people with diabetes need to effectively manage their disease and prevent costly complications.
Permitting insurers to sell health insurance across state lines also minimizes existing key consumer protections for Americans with diabetes, the group said, putting patients at additional risk of having to pay more for the essential services needed to treat their condition. The ADA also offered a sharp critique of the short-term, limited-duration plans, saying they’re generally inadequate for people with diabetes.
“In sum, these changes could destabilize the individual and small-group health insurance markets and make comprehensive coverage unaffordable,” the ADA wrote in a statement. The Association does not support the mandates of yesterday’s executive order because they will threaten access to affordable and adequate coverage for people with diabetes.”
The American Academy of Actuaries also joined the fray, with Academy Senior Health Fellow Cori Uccello saying in a statement that the executive order could have unintended effects.
“These effects could include tilting the market in favor of entities with weaker benefits or solvency standards and weakening the protections for consumers with pre-existing health conditions,” she said. “To avoid these adverse outcomes, the risks and consequences for consumers and insurers need to be well understood and addressed before the departments of Labor, Treasury, and Health and Human Services issue any regulations pursuant to this order.”
One of the few groups to applaud Trump’s decision was American Trucking Associations, which said the order would benefit the approximately 7.5 million trucking-related jobs in the U.S. by allowing people to pool together to purchase health insurance plans that are sponsored by larger associations and groups.
“Most trucking companies are small businesses, with nine in 10 carriers having fewer than six trucks,” said ATA President and CEO Chris Spear in a statement. “The types of plans the president announced today will allow those companies to pool resources and offer affordable healthcare options that meet the needs of their employees.”