On August 1, the Department of Health and Human Services (HHS), Department of Labor, and Department of Treasury issued a final rule governing the extension of short-term limited-duration health plans.
Under the rule, insurers can issue new short-term plans that can be extended for up to 36 months. Previously these policies were limited to three months as a way to protect consumers from out-of-pocket financial hardship should they get sick and need coverage these bare bones plans do not include.
These new expanded short-term plans can deny or charge people more for coverage based on their health status, and are exempt from covering essential health services, like prescription drugs or hospitalization. The new plans can also charge older people more than three times what they charge a younger person for the same coverage.
A statement from Chris Hansen, president of the American Cancer Society Cancer Action Network (ACS CAN) follows:
"The rule released today poses a serious threat to cancer patients' ability to access quality, affordable health coverage. Allowing insurers to issue these short-term health plans that dodge important patient and consumer protections alongside more comprehensive plans will likely leave older and sicker Americans in the individual insurance marketplace with few, if any, affordable health coverage choices. Young and healthy people could be more apt to pick one of these new, inadequate plans with lower premiums, poor coverage and few benefits – leaving them vulnerable if they are diagnosed with a serious illness like cancer. Patients living with serious conditions will be left paying more for the coverage they need if they can afford coverage at all.
"Although this rule is new, its likely impact on the health insurance market is familiar. Prior to 2014, similar plans aimed solely at lowering monthly health care costs were widely available and cancer patients, survivors and others with a history of serious illness often found it impossible to get coverage on the individual insurance market. Prior to the enactment of the Affordable Care Act (ACA) healthy people discovered these plans were highly problematic and often entirely inadequate when they faced an unexpected cancer diagnosis. Today, these plans will compete with ACA-compliant plans, drawing young and healthy people away from the individual marketplace and driving up costs for those who most need adequate, affordable health care coverage.
"ACS CAN encourages states to take into account patient needs and move to protect and strengthen their insurance markets with state laws regulating these potentially damaging products. Cancer patients and survivors must have access to high-quality, affordable insurance that provides comprehensive coverage, and ACS CAN stands ready to work with state lawmakers in this effort."