Commentary, Trump Administration

Comments due Monday on Trump’s scheme to bring back health plan bars to pre-existing conditions

While last year’s legislative repeal-and-replace proposals were rejected resoundingly by the American public and by a slim majority in the Senate, the Trump administration has been moving on its own to implement changes to the current health care landscape. The latest proposal from the administration would enable insurers to sell “short-term” health insurance policies that last up to 364 days—hardly a short term under any reasonable interpretation when traditional health insurance policies last 365 days. While these plans are currently on the market, they can last no more than three months under rules put in place by the Obama administration.

The Trump administration touts these plans as a solution to the country’s high health care costs. But these plans have cheap premiums because they can cherry pick whom they will cover. Upon closer examination, these plans look an awful lot like those that left millions uninsured and drowned others in medical debt before the passage of the Affordable Care Act. Here are some excerpts from a policy currently sold here in North Carolina by Golden Rule Insurance Company, which is a UnitedHealthcare company:

Preexisting conditions, and complications resulting from a preexisting condition, will not be covered under the policy.

Preexisting condition means those conditions for which medical advice, diagnosis, care or treatment was received or recommended, or a condition that had manifested itself, within the one-year period immediately preceding the effective date of a person’s coverage; or a pregnancy existing on the effective date of coverage.

Another reason that premiums are low for these plans is that you get what you pay for. These policies cover so few benefits and pay out so little in claims that insurance companies selling them actually reap much greater profits than on traditional plans. Short term plans routinely exclude benefits not just for coverage of pre-existing conditions, but also for essential services like prescription drugs, mental health and substance use disorder treatment, pregnancy care, and preventive care, among a host of others.

Even for the few services that are covered, enrollees will be stuck with large out-of-pocket bills. Some Golden Rule policies on the market have deductibles of up to $12,500 for a policy that lasts only three months, and some of these policies also impose dollar limits on what they’ll pay out in benefits over an enrollee’s lifetime or policy period. One Golden Rule policy in NC includes a $250,000 lifetime limit.

And that’s the trend: insurers make bank off of these policies while enrollees attracted by the low premium find themselves without adequate coverage and face-to-face with crushing medical debt once they need care.

These plans are dangerous to those who enroll in them. But they also undermine the ACA and those who benefit from comprehensive coverage there. Through their discriminatory premiums and benefit designs, short-term plans are designed to pull young and healthy folks out of the ACA coverage market, leaving the remaining risk pool older, sicker, and more expensive. This puts comprehensive coverage out of reach, especially for North Carolinians who make too much to qualify for premium subsidies under the law.

Unlike last year when the GOP-controlled Congress failed to revive these discriminatory plans through legislation, the Trump administration is proposing to do this through administrative rulemaking, meaning that members of the public can weigh in by submitting comments until the deadline on Monday, April 23. Click here to submit your own comment.

Commentary

Record ACA profits for Blue Cross NC in 2017, but uncertainty remains due to Trump’s health care sabotage

Blue Cross Blue Shield of North Carolina announced today that it turned an unexpectedly high profit in 2017, earning $734 million in net income, largely in part due to a profitable line of business in its Affordable Care Act (ACA) plans. Last year, the company turned an overall profit, but experienced a small loss on its ACA business.

Normally, insurer profitability would suggest market stability, which suggests premiums should stabilize. But under the Trump presidency, that’s not so clear.

When insurers develop their premiums for future years, they’re trying to predict the future – how many people will we cover? How old and how sick will our members be? How much care will they need? How expensive will that care be?

With a Trump administration and Congress still hell-bent on sabotaging the Affordable Care Act, answering those questions is harder than usual. This year, Blue Cross raised its premiums by 14.1 percent, but it has repeatedly noted the fact that the price increase would have been “near zero” if not for Trump eliminating payments for cost-sharing reductions.

In December, Congress eliminated the penalty for individuals going uninsured starting in 2019. Will fewer young and healthy people enroll in future years as a result? Perhaps even more damaging, the Trump administration has proposed to make it easier to sell junk insurance plans that don’t cover critical benefits and that even charge people higher prices for pre-existing conditions. If enacted, will those new plans pull out healthy people from the ACA’s marketplaces, leaving a sicker—and more expensive—risk pool? Some policy experts think millions may leave the ACA marketplaces to flock to these low-cost, bare-bones coverage policies.

What’s best for consumers under the ACA is a stable, robust health insurance market with a broad risk pool to balance out costs. That ensures that people with chronic conditions or those who become sick don’t have to pay an arm and a leg just to have coverage.

Clearly, the ACA is working for hundreds of thousands of North Carolinians, and the market had been on a stabilizing trajectory before Trump got into office. Imagine how much more affordable health insurance could be if Congress and the President did anything but try to sabotage it.

Commentary

CBO report contradicts Tillis on Trumpcare and pre-existing conditions

During a Facebook Live Q&A session on May 11, Senator Thom Tillis told North Carolinians that he is comfortable with letting states decide whether to protect people with pre-existing conditions from pricing discrimination. His rationale? No state would want to take up the American Health Care Act’s (AHCA) waivers from those protections.

Well, the experts at the Congressional Budget Office (CBO) disagree. According to the report released yesterday by Congress’ objective legislative impact scorekeeper, half of the U.S. population would live in states that waived the ban on charging people higher premiums based on health status (called “community rating”) and/or the requirement that plans cover minimum services, such as mental health and prescription drugs (called “essential health benefits”).

The CBO looks to states’ past behavior to predict whether they would take up a waiver from the essential health benefits requirement and the community rating protection. They “expect that states that previously mandated fewer benefits [be covered by health plans] would be more likely to apply for a waiver to modify the EHBs.”

Before the ACA, only 18 states mandated coverage of maternity care and only 23 states mandated some mental health benefit coverage. North Carolina was not among those states. Before the ACA, 18 states limited or prohibited pricing discrimination against people with pre-existing conditions. North Carolina was not among those states.

What’s more, the CBO expects that states with “fewer insurers” (North Carolina has one statewide insurer on the individual market) and “higher premiums” (North Carolina has the second-highest gross benchmark plan premium before subsidies in the country) would be those most likely to seek those waivers.

Here’s what the CBO says about what will happen in states that seek both waivers. Fair warning: it is shocking:

About one-sixth of the population resides in states that CBO and JCT expect would obtain waivers from EHB and community-rating requirements and make substantial changes to market regulations. Those changes would result in significantly lower premiums for those with low expected health care costs and higher nongroup enrollment by those individuals than under current law—and lower average premiums for such people than in states making moderate changes to regulations. However, over time, less healthy individuals (including those with preexisting or newly acquired medical conditions) would be unable to purchase comprehensive coverage with premiums close to those under current law and might not be able to purchase coverage at all.

They continue, noting that the return of medical underwriting (premium pricing based on health status and pre-existing conditions), would completely destabilize markets for people who need health care:

Eventually, CBO and JCT estimate, those premiums [for less healthy people or those with preexisting medical conditions] would be so high in some areas that the plans would have no enrollment. Such a market would be similar to the nongroup market before the enactment of the ACA, in which premiums were underwritten and plans often included high deductibles and limits on insurers’ payments and people with high expected medical costs were often unable to obtain coverage.

Sen. Tillis doesn’t seem to recognize the severe damage that the Republican health care bill would cause or the likelihood that its waivers will hit home here in North Carolina. Let’s hope that he and his colleagues in the Senate carefully read the CBO report.

Commentary, News

Congress changes Trumpcare in dead of night to allow insurers to cap coverage and deny care

Shortly before 11 PM last night, the Republican House of Representatives amended their Trumpcare bill. Following the House’s delay of a planned floor vote on the American Health Care Act yesterday, Republican leadership made the change to persuade hardline conservatives in the Freedom Caucus to vote for the bill.

Zachary Tracer from Bloomberg explains how this last-minute, secretive amendment drastically alters the rules of the insurance market:

If healthy people can buy cheap, skimpy insurance plans, they don’t subsidize those who are sick — meaning that people who aren’t healthy have to pay more, or may not be able to get insurance. Cutting the rules could push insurers to offer only limited plans, resulting in less choice for consumers, particularly those who are sick or want more comprehensive coverage.

This change also opens the door for insurance companies to reintroduce lifetime limits and annual caps on coverage, yet it’s reported that Congress will vote on this bill less than 24 hours after making the change. After years of peddling alternative facts about how hastily and secretively Congress passed the Affordable Care Act seven years ago, Republican leadership in Congress aims to change the health care system under the cover of night to allow millions of Americans to be denied care and coverage.

After last night’s failed effort to bring Trumpcare to a vote on the House floor, President Trump delivered an ultimatum to the House—pass this bill or nothing at all. The candidate who promised that everyone would be covered under his plan seems to care more about the appearance of getting a bill done than he cares about what the bill does.

Commentary, public health, Trump Administration

Congress sneaking in last-minute change to make Trumpcare even worse

Ahead of a floor vote scheduled for later today, Republican leadership in the House has realized that they do not have enough votes right now to pass the American Health Care Act (AHCA), the Trump-Ryan proposal to repeal and replace the Affordable Care Act (ACA). As a result, Trump and others are trying to sneak in disastrous last-minute changes to an already terrible bill to win over conservative votes at the expense of millions of lives.

One such change that they are proposing is repealing the requirement that health insurance plans cover a core set of essential health benefits. This guarantees that plans provide coverage for core services, such as hospitalizations, maternity care, prescription drugs, as well as mental health and substance use disorder treatment.

If this provision is repealed, insurers could offer bare-bones plans that don’t cover services that North Carolinians need, meaning only the most expensive, premium plans would cover services like treatment for opioid addition, for example.

What’s more, other key consumer protections would fall apart. While the AHCA does not repeal the ACA’s prohibition on lifetime limits and annual caps on services, that protection is useless without the essential health benefits requirement. Current law only applies these protections to services considered essential health benefits. If this provision is repealed, insurers may be free once again to arbitrarily cut off coverage for patients because their treatment is too expensive.

The haste with which Congress and Trump are moving to repeal our health care is telling; why rush to change one-sixth of the U.S. economy and millions of lives unless you don’t want the public to see what you’re doing? After all, we still haven’t seen the bill language that the House will vote on today. It seems like the Republicans may have to pass the bill to find out what’s in it.