Short-term Health Plans Leave Consumers On The Hook For Massive Medical Costs, Investigation Finds

By Consumers For Quality Care, on June 29, 2020

Short-term Health Plans Leave Consumers On The Hook For Massive Medical Costs, Investigation Finds

According to a new investigation by the U.S. House Energy and Commerce Committee, short-term health plans regularly refuse to cover the costs of treating beneficiaries. The shocking new report found that plans often deny coverage or charge more for people with preexisting conditions.

Despite this, enrollment in these risky plans has surged as a result of the Trump administration lifting restrictions to provide an alternative for people who couldn’t afford plans under the Affordable Care Act (ACA) or made too much money to qualify for subsidies.

There was an increase of 600,000 enrollments in short-term plans between 2018 and 2019 across nine insurers.

Short-term plans were originally intended to fill gaps in coverage for up to a three-month limit. The administration has allowed the plans to be renewed for up to three years. They have also been made available for signups all year long, whereas ACA signups are limited to six weeks.

The House Democratic investigation into 14 companies that sell, or help people buy the plans, found “deceptive” and “misleading” marketing tactics used to attract customers who might not know their plans don’t cover all of the same benefits ObamaCare does, like prescription drugs or mental health care.

In limited instances, the report found that plans exclude coverage of routine care like wellness exams, preventative care and birth control.

The report also found that coverage limitations vary from plan to plan and are not always clear in marketing materials, making it particularly confusing for patients to understand what they are buying.

For example, some plans impose a maximum of $500 per policy period for visits to the doctor’s office, $1,000 for a day in the hospital, $500 for an emergency services visit, and $2,500 for a surgery.

The report concluded that consumers enrolled in these plans run the risk of incurring massive medical bills, should they fall sick.