NOTE: The opinions expressed in this column are the author’s own and do not necessarily reflect the view of the FFL organization.
Unbeknownst to many, August 10th was a big day for health care across our United States. Indeed, that was the day that the Trump Administration’s new rules for “short-term” health plans were effectively realized for those states opting to take them to market.
Short-term plans originally served as stopgap measures for those experiencing brief lapses in health insurance coverage. The plans could be thought of as relief measures – available for no longer than three non-renewable months – for vulnerable individuals, who were waiting to acquire long-term coverage.
In theory, the short-term plans are a great idea. What is not to love about giving more, not less, choices to consumers in the wake of dwindling options because of Obamacare.
These plans could help millions more get insured at rates that are 50 to 80 percent lower than Obamacare exchange rates. Moreover, empowering states to make the best decisions possible for their residents, the new rules are real federalism at work.
While these short-term plans sound well and good, the versions being considered by some states are nothing close to short term. In fact, the initial coverage window is 364 days, with the option to renew for up 36 months. That’s one day shy of four years. What these short-term plans actually provide is a new revenue stream for insurance companies and new market options for consumers, separate and apart from insurance plans offered on the Affordable Care Act exchanges, but without requiring the insurers to actually “insure” anything.
Indeed, one of the most concerning aspects of these short-term health plans is, in fact, the lack of coverage that the plans provide. Individuals are effectively paying for an empty promise – wasting their hard-earned money while lining the pockets of insurance executives with no intention to pay out should the insured actually need services.
Worse yet, taxpayers will foot the bill for the eventual needs of these falsely insured individuals. The plans don’t cover basic needs like maternal care, prescription medications, mental health care or pre-existing conditions. But that doesn’t mean the plan purchaser will go without. In all likelihood, many will access care and being uncovered, the costs will fall on providers and eventually taxpayers as the medical debt adds up.
Furthermore, these same insurance companies will pass on these costs through higher costs for fully insured patients and ultimately lead to higher out-of-pocket costs for middle class families and individuals.
Just take maternal care, for example and consider that the average out-of-pocket cost for a delivery is enormous: $18,000 for a natural birth, or $28,000 for a cesarean birth. For most middle-class individuals and families, the cost of delivering their bundle of joy would become a financial nightmare.
States need to acknowledge such basic facts as they consider whether to adopt this Administration’s short-term health plan option, and on what terms. And, yes, opting out is an option – five states have already opted to eliminate the short-term plans from their health insurance menu.
Before you take issue with, or make assumptions on, where I am politically on health care or short-term health care — please indulge me as I share my personal experience as an insured citizen, who happened to be both disadvantaged by, and a beneficiary of, the Affordable Care Act.
The Disadvantage: As a 1099’d political consultant, I receive zero benefits from health care to retirement. This is not a cry-me-a-river statement, just the facts. As such, and as a single mother of twins, the Affordable Care Act exchange was my only option for insurance coverage. I am pleased to report that my non-smoking, three-year-old twins are insured at a rate of $535/month with an extremely high deductible. (Let’s just say that I am still paying off twin #2’s broken leg last year — a $12,000 ER visit and physical therapy follow up.) Given the high rate of insuring my children, insuring myself (even under the guise of a “family plan”), is just not in the cards. This is not to say that I do not visit doctors, I do. This is just to say that I’d rather take the tax hit, pay for the entirety of any doctor visit, and take the risk on accidents or disease before I pay the $1000 plus, per month premium that was quoted to me for the family plan on the ACA exchange
The Benefit: On the flip, and as a single, 39-year-old “geriatric” pregnant woman, who was carrying twins, I would have never been able to obtain, nor afford, health insurance but for the mandate to cover people with pre-existing conditions. Let’s face it — twins are often born prematurely, and especially so when the Mom is older. Who wants to cover that? I remember calling my dad several months into my pregnancy, stressing over the medical bills that I would face if they were born prematurely. But, thankfully, there was relief. The ACA exchange made it nearly impossible for an insurer to deny me and my in utero sons coverage. And, thank god for that — my twins ended up arriving at 11 weeks early and spent the first two months of their lives in a neonatal intensive care unit. The medical care that they received incurred costs well over a million dollars. But, again, thanks to the mandate, I walked out of the NICU with two thriving sons and the ability to stand on my feet financially.
So, you see, health care is a very personal thing. It all boils down to the protection of those humans around us, whom we love and cherish so much. Our be-alls and end-alls.