Trump agrees to let insurers sell cheaper health plans than ObamaCare

Ben Davidson
August 4, 2018

The fight to preserve the Affordable Care Act has heated up.

Unable to repeal much of the Obama-era law, Trump's administration has tried to undercut how the law is supposed to work and to create options for people who don't qualify for subsidies based on their income. Insurers will soon be allowed to sell these policies for just under a year.

Administration officials say the short-term plans will provide a cheaper health insurance alternative for those who can't afford to buy coverage on the Obamacare exchanges. "The premium baseline from which they're operating is entirely too high and unaffordable for so many people, but under President Trump we've brought stabilization there that at least is bringing some relief to individuals".

The other ways they keep their premiums down is by offering bare-bones coverage in the first place. A short-term plan ran about $124 a month on average in the last quarter of 2016, while an unsubsidized ObamaCare plan averaged $393.

Until now, the health-care law had a built-in deterrent for those considering short-term plans.

The expanded plans will be able to go on sale in two months, or as long as it takes for state regulators to approve them. It points to the president's own statements and actions taken by the Health and Human Services Department to discourage citizens from enrolling in health insurance exchanges. What was your experience? And, unlike Obamacare policies, they don't have to cap consumers' cost-sharing burden at $7,350 for 2018.

Brokers can make commissions of about 20% on short-term plans, compared with 5% on ACA plans.

But those who actually need care could find themselves having to pay more out of pocket for treatment and medications. "When I was in the [Obama] administration no one asked me if some law passed by Gerald Ford or Lyndon Johnson or Richard Nixon, was something I wanted to enforce".

Short-term plans are less expensive because, unlike their ACA counterparts, which cannot bar people with preexisting health conditions, insurers selling these policies can be choosy - rejecting people with illnesses or limiting their coverage. Federal regulations for association health plans have been approved.

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Federal health officials said that insurers will have to give customers notices, encouraging them to read carefully what the plans do and do not cover.

Earlier Wednesday, the Trump administration said it's clearing the way for health insurers to sell short-term plans as a low-priced alternative to pricey Obama-law policies for people struggling with high premiums.

"By actively and avowedly wielding executive authority to sabotage the ACA, defendants are not acting in good faith; instead, they have usurped Congress's lawmaking function, and they are violating the Constitution", the complaint said.

Some policy experts, including those from the Center on Health Insurance Reforms at Georgetown University, warn that allowing increased use of the skimpier coverage offered by short-term plans could leave some patients in financial or medical difficulty. Also, 300,000 people who now buy individual market polices outside of the Obamacare exchanges will switch to short-term plans and another 100,000 uninsured folks will purchase them next year. Of those, 100,000 are now uninsured, and 200,000 will switch from an Affordable Care Act plan. The administration says it expects about 1.6 million people to pick a short-term when the plans are fully phased in.

President Donald Trump has been enthusiastic.

"We can't let the Trump administration and big insurance companies rewrite the rules", Sen.

Adversaries of the plans are calling them "junk insurance".

However, these plans also don't have to adhere to all of Obamacare's rules, particularly the one requiring insurers to offer comprehensive coverage.

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