The Los Angeles Times: States start pushing back against Trump's junky short-term health plans

May 28, 2018

California, Illinois and other states have begun pushing back against efforts by the Trump administration to expand the availability of junk health insurance plans, which would undermine the Affordable Care Act's consumer protections and marketplace stability.

In Sacramento, the California Senate last week approved a measure that would completely outlaw short-term health plans, which it defines as any plan with a term of less than 12 months. Authoritative ACA tracker Charles Gaba reports that California might become the first state to forbid short-term plans entirely.

On Friday, the Illinois Senate passed and sent to the House a bill that would limit short-term plans to six-month terms and render them nonrenewable. The bill also would require that the policy and marketing materials for such plans declare in bold type that they don't offer the consumer protections of ACA plans.

California has embraced the Affordable Care Act ... [so] there is no reason to allow these noncompliant products to remain in the market.


These initiatives aim to counter what may be the Trump administration's most insidious attack on the Affordable Care Act: a proposal to expand the availability of short-term health plans. As we've reported, these are bare-bones plans that the ACA limits to maximum nonrenewable terms of 90 days. They're not designed as substitutes for real health insurance but merely as bridges for individuals or families making a transition from job to job or coverage to coverage.

Trump has proposed to allow such plans to remain in effect for up to a year and to make them renewable. As is true of so many of Trump's proposals, this one looks like a consumer boon only on the surface. Short-term plans aren't subject to ACA rules forbidding annual or lifetime benefit limits and requiring coverage of "essential health benefits" such as maternity care, prescription drugs, hospitalization, or mental health and substance abuse services. They can upcharge or reject applicants with preexisting medical conditions.




California has "embraced the Affordable Care Act" to the point where the uninsurance rate is only 6.8%, the California measure's sponsor, Sen. Ed Hernandez (D-Azusa), said in a position statement. Since "California has been enacting policies to rid the individual and small group markets of junk insurance even before the ACA, … there is no reason to allow these noncompliant products to remain in the market."

Hernandez's measure would take effect on Jan. 1 if it's passed by the Assembly and signed by the governor. The bill passed on a 27-10 vote, with Sen. Anthony Cannella (R-Ceres) joining the Senate's Democrats. Two Republicans, Janet Nguyen of Garden Grove and Scott Wilk of Santa Clarita, didn't cast votes.

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