The state of California is eyeing legislation that would ban short-term health insurance plans backed by the Trump administration. While other states have policies that prohibit plans that do not comply with the terms of the Affordable Care Act, the California bill would be the first to ban sale of the short-term policies sometimes known as “junk insurance.”
The proposed bill is just one of four that California Gov. Jerry Brown is currently considering related to Republican alternatives to Obamacare. Another bill, if passed, would prohibit low-income people on Medi-Cal (the state's insurance plan equivalent to Medicaid) from being required to work to receive benefits.
State legislators have been the force behind these initiatives to block the Trump Administration’s Obamacare alternatives in the state of California. Some lawmakers in the Golden State say they fear such junk plans could push people into bankruptcy.
“Make no mistake, junk policies are not alternatives to comprehensive health plans. These short-term policies are dangerous because they subject people to huge health care bills, barely cover any services and give people a false sense of security,” California state Sen. Ed Hernandez, a Democrat, said in a statement. “California cannot go back to the days before the ACA when you could be denied care completely or go into financial ruin because of these junk plans.”
At a national level, Sen. Tammy Baldwin, D-Wis., and 30 of her Democratic colleagues are seeking to block the regulation that could open the gates to so-called junk coverage.
“The Trump Administration is rewriting the rules on guaranteed health care protections that millions of Americans depend on," Baldwin said in a statement. "They are moving forward on an expansion of junk insurance plans that can deny coverage to people with pre-existing conditions and don’t have to cover essential services like prescription drugs, emergency room visits and maternity care. President Trump’s latest act of sabotage will expand junk insurance plans that could increase costs and reduce access to quality coverage for millions, force premium increases on older Americans, and harm people with pre-existing conditions.”
Health care advocacy groups, like The American Cancer Society Cancer Action Network (ACSCAN) said junk insurance “poses a serious threat to cancer patients’ ability to access quality, affordable health coverage.”
Trump administration officials disagree with their critics, however.
Health and Human Services Secretary Alex Azar said, via the Wall Street Journal, that short-term insurance policies “will help increase choices for Americans faced with escalating premiums and dwindling options in the individual market.”
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According to an analysis by the Henry J. Kaiser Family Foundation, the future is grim when considering the addition of short-term plans to the health insurance market. The authors of the analysis wrote:
The expected expansion of loosely-regulated short-term health plans will also likely siphon away healthy people, pushing premiums up further for ACA-compliant plans on and off the exchange.
While the majority of people on the exchanges receive subsidies and will be protected from premium increases, middle-class people who do not qualify for subsidies will feel the brunt of future premium increases. This is especially true of people with pre-existing conditions who likely would not qualify for short-term plans that base eligibility and premiums on people’s health.
Gov. Brown now has until Sept. 30 to sign the legislation to ban short-term policies into law or veto it, according to the Sacramento Bee.
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