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ashoup
In Research, Fact Sheet

FACT SHEET: Trump Vows to “Never Give Up” MAGA-Republican Efforts to Repeal the Affordable Care Act, Ripping Health Care Away From Millions

Over the weekend, Donald Trump renewed calls to “terminate” the Affordable Care Act (ACA), claiming his administration’s failure to repeal the ACA was “a low point for the Republican party.” Repealing the ACA would rip coverage from 20 million Americans and raise premiums for nearly 15 million more. The GOP repeal scheme would also rip away protections for the over 135 million Americans with pre-existing conditions and put insurance companies back in charge, allowing them to deny basic care like hospital visits and prescription drugs. Despite overwhelming support for the ACA from the American people, including record enrollment and consistent support across parties, MAGA-Republican lawmakers can’t quit their “repeal” agenda. 

If the Affordable Care Act is repealed:

  • GONE: Protections for 135 million Americans with pre-existing conditions, including 54 million people with a pre-existing condition that would make them completely uninsurable.
  • GONE: Medicaid expansion, which covers more than 21 million people. 
  • GONE: 49 million seniors will have to pay more for prescription drugs because the Medicare ‘donut hole’ will be reopened.
  • GONE: 2.3 million adult children will no longer be able to stay on their parents’ insurance. 
  • GONE: Insurance companies will be able to charge women more than men.
  • GONE: Premium tax credits that help 80 percent of people who purchase health care on the marketplace.
  • GONE: Key support for rural hospitals. 
  • GONE: Ban on insurance companies having lifetime caps on coverage.
  • GONE: Requirements that insurance companies cover prescription drugs and maternity care.
  • GONE: 61.5 million Medicare beneficiaries will face higher costs and disruptions to their medical care. 

Republican Threats Could Lead To More Than 35 Million People Losing Their Coverage

  • 35 Million People Would Lose Coverage. If Republicans succeed in repealing the ACA, 35 million people will lose coverage obtained through the marketplaces. This would raise the uninsured rate to nearly 19 percent.
  • The Uninsured Rate Would Increase By 69 Percent. Repealing the ACA would increase the number of uninsured Americans from 26.6 million to 61.6 million, according to 2020 data. Americans of all ages would be impacted by coverage losses:
  • 1.7 million children would become uninsured, an increase of 48 percent.
  • 4.9 million young adults aged 19 to 26 would become uninsured, an increase of 76 percent. 
  • 8.8 million adults aged 27 to 49 would become uninsured, an increase of 60 percent.  
  • 5.6 million million older adults aged 50 to 64 would become uninsured, an increase of 95 percent. 

Overturning The ACA Would Exacerbate Racial Disparities In Coverage

The uninsured rate for Black Americans would spike to 20 percent, 32 percent for American Indian/Alaska Natives, 17 percent for Asian/Pacific Islanders, and 33 percent for Hispanics — compared to 13 percent for white Americans. 

  • 3.1 Million Black Americans Would Lose Coverage. The Urban Institute estimates that 3.1 million Black Americans would become uninsured if the ACA were overturned. According to the Center on Budget and Policy Priorities, the ACA helped lower the uninsured rate for nonelderly African Americans by more than one-third between 2013 and 2016 from 18.9 percent to 11.7 percent. 
  • 5.4 Million Latinos Would Lose Coverage. The percentage of people gaining health insurance under the ACA was higher for Latinos than for any other racial or ethnic group in the country. According to a study from Families USA, 5.4 million Latinos would lose coverage if Republicans repeal the ACA.
  • 1.3 Million Asian/Pacific Islanders Would Lose Coverage. 1.3 million Asian/Pacific islanders would become uninsured if the ACA were overturned, according to estimates from the Urban Institute. Research shows the ACA cut uninsurance rates among Asian Americans by more than half–from nearly 20 percent to just under 8 percent — eliminating coverage disparities with white Americans.
  • 488,000 American Indians And Alaska Natives Would Lose Coverage. According to the Urban Institute, the uninsurance rate for American Indians and Alaska Natives would more than double in 10 states if the ACA is overturned. Nationwide, 488,000 would lose coverage. 

Republicans Want To Put Insurance Companies Back In Charge, Ending Protections For The 135 Million People With A Pre-Existing Condition

  • According to a recent analysis by the Center for American Progress, roughly half of nonelderly Americans, or as many as 135 million people, have a pre-existing condition. This includes:
    • 44 million people who have high blood pressure
    • 45 million people who have behavioral health disorders
    • 44 million people who have high cholesterol
    • 34 million people who have asthma and chronic lung disease
    • 34 million people who have osteoarthritis and other joint disorders
  • More than 17 million children, 68 million women, and 32 million people aged 55-64 have a pre-existing condition.

Republicans Want To Give Insurance Companies The Power To Deny Or Drop Coverage Because Of A Pre-Existing Condition

Before the Affordable Care Act, insurance companies routinely denied people coverage because of a pre-existing condition or canceled coverage when a person got sick. Now insurance companies could have the license to do this again. 

  • A 2010 congressional report found that the top four health insurance companies denied coverage to one in seven consumers on the individual market over a three-year period. 
  • A 2009 congressional report found that some of the largest insurance companies had retroactively canceled coverage for 20,000 people over the previous five-year period.
  • The Kaiser Family Foundation estimates that 54 million people, or 27% of adults aged 18 to 64, have a condition that would have been grounds for coverage denial in the pre-ACA marketplace. 

Coronavirus Could Be Considered A Pre-Existing Condition. Without the ACA, millions of Americans who have contracted the coronavirus would likely be deemed as having a pre-existing condition and be at the mercy of their insurance companies who could refuse to pay for needed care.

Source: Kaiser Family Foundation, 2016; 2019

Republicans Want To Give Insurance Companies The Power To Charge You More, While Their Profits Soar

  • Premium Surcharges Could Once Again Be In The Six Figures. Republican threats to repeal the ACA could mean insurance companies once again could charge people more because of a pre-existing condition. The 2017 House-passed repeal bill had a similar provision, and an analysis by the Center for American Progress found that insurers could charge up to $4,270 more for asthma, $17,060 more for pregnancy, $26,180 more for rheumatoid arthritis and $140,510 more for metastatic cancer.
  • Women Could Be Charged More Than Men For The Same Coverage. Prior to the ACA, women were often charged higher premiums on the nongroup market than men were charged for the same coverage. 
  • People Over The Age of 50 Would Face A $4,000 “Age Tax.” Without the ACA, insurance companies could charge people over 50 more than younger people. The Affordable Care Act limited the amount older people could be charged to three times more than younger people. If insurers were to charge five times more, as was proposed in the 2017 Republican repeal bill, that would add an average “age tax” of $4,124 for a 60-year-old in the individual market, according to AARP.
  • 80 Percent of People With Marketplace Coverage Would Pay More. If the ACA is repealed, consumers would no longer have access to tax credits that help them pay their marketplace premiums, meaning 80 percent of people who have marketplace coverage would see price increases.
  • Seniors Would Have To Pay More For Prescription Drugs. Republicans’ plan to repeal the ACA, would make 49 million seniors pay more for prescription drugs because the Medicare “donut” hole would be reopened. 
  • 60 Million Medicare Beneficiaries Could Face Higher Costs. In addition to paying more for preventive care and prescription drugs, Medicare beneficiaries could face higher premiums without the cost-saving measures implemented under the ACA. If Republicans are successful, seniors would also face less coordinated care. 
  • Insurance Companies Would Not Have To Provide The Coverage You Need. The Affordable Care Act made comprehensive coverage more available by requiring insurance companies to include “essential health benefits” in their plans, such as maternity care, hospitalization, substance abuse care, and prescription drug coverage. Before the ACA, people had to pay extra for separate coverage for these benefits. For example, in 2013, 75 percent of non-group plans did not cover maternity care, 45 percent did not cover substance abuse disorder services, and 38 percent did not cover mental health services. Six percent did not even cover generic drugs.

Republicans Want To Give Insurance Companies The Power To Limit The Care You Get, Even If You Have Insurance Through Your Employer

  • Insurers Could Reinstate Lifetime And Annual Limits On 179 Million Privately Insured Americans. Repealing the Affordable Care Act means insurance companies would be able to impose annual and lifetime limits on coverage for those insured through their employer or on the individual market. In 2009, nearly 6 in 10 (59%) covered workers’ employer-sponsored health plans had a lifetime limit, according to the Kaiser Family Foundation. 
  • Americans Could Once Again Have To Pay For Preventive Care. Because of the ACA, health plans must cover preventive services — like flu shots, cancer screenings, contraception, and mammograms – at no cost to consumers.
  • Employers Could Eliminate Out-Of-Pocket Caps, Forcing Employees To Pay More For Care. Under the ACA, health insurers and employer group plans must cap the amount enrollees pay for health care each year. If the law is overturned, these cost-sharing protections would be eliminated. The ACA also barred employer plans from imposing waiting periods for benefits that last longer than three months.

Republicans Want To End Medicaid Expansion

  • More Than 21 Million People Enrolled Through Medicaid Expansion Would Lose Coverage. As of 2022, more than 21 million people were enrolled in Medicaid in over 40 states and territories.
  • Access To Treatment Would Be In Jeopardy For 800,000 People With Opioid Use Disorder. Roughly four in 10, or 800,000 people with an opioid use disorder are enrolled in Medicaid. Many became eligible through Medicaid expansion.
  • Key Support For Rural Hospitals Would Disappear. States that haven’t expanded Medicaid have poorer financial performance than states that have expanded Medicaid. If Medicaid provisions in the ACA were to be stripped, all rural hospitals would face this financial cliff.

Republicans Are Willing To Sacrifice Your Care For More Tax Cuts For The Wealthy

  • The Richest Americans Would See Tax Cuts Averaging $200,000. Overturning the ACA would cut taxes for the top 0.1 percent of earners by an average of $198,000.
  • Drug Companies Would Save Billions. If the ACA is struck down, pharmaceutical companies would pay $2.8 billion less in taxes each year.
  • Repeal Would Weaken The Medicare Trust Fund. A significant portion of the tax cuts resulting from ACA repeal would come “at the direct expense of the Medicare Trust Fund,” according to the Center on Budget and Policy priorities.
ashoup
In Fact Sheet, Research

“Medicare Autumn” Fact Sheet: Protecting Seniors From Prescription Cost Price Hikes

Thanks to the Inflation Reduction Act, championed by President Biden and Democrats in Congress, Medicare is better than ever and seniors are protected from outrageous price increases by big drug companies as a result of the law’s penalties on price increases greater than inflation. Hundreds of drugs have seen their list prices grow faster than inflation, forcing seniors to make tough decisions between needed medication and basic necessities — all while big drug companies bring in tens of billions in revenue and spend lavishly to reward shareholders. The Inflation Reduction Act has also brought down the cost of prescription medications for seniors on Medicare by capping insulin costs at $35 per month, providing free vaccines, and allowing Medicare to negotiate drug prices directly with pharmaceutical companies.

This is just the beginning: In 2025, seniors’ total drug costs will be capped at $2,000 per year and, in 2026, new savings from Medicare’s drug price negotiation will take effect. Together, these provisions will save seniors thousands of dollars on prescription drugs. These policies lower costs and improve access to care, which are essential for improving the health and well-being of millions of Americans nationwide.

BY THE NUMBERS

  • Medicare beneficiaries save as much as $600 per dose thanks to the Inflation Reduction Act’s inflation-pegged price hike rebates.
  • Medicare beneficiaries only pay 20 percent of the inflation-adjusted amount in copays for drugs with prices that have increased faster than the rate of inflation, 
  • 34 drugs will have reduced copays until the end of the year thanks to the Inflation Reduction Act. 

Seniors Will Continue To Save Hundreds On Prescription Costs Through Rebates For Drug Prices That Increase More Than Inflation. Thanks to the Inflation Reduction Act, Medicare beneficiaries save as much as $600 per dose. The new law requires drug companies to pay Medicare rebates if their drug prices rise faster than inflation, and those rebates are passed on as savings to seniors. For decades, big drug companies have been launching new drugs at sky-high prices and continuously raising prices faster than inflation, hurting the individuals reliant on them all while making record profits.

Drug Prices Have More Than Tripled Since Launch For The Top 25 Drugs By Medicare Spending. According to an analysis by the AARP, drug prices have more than tripled – an average increase of 226 percent – for the 25 drugs with the highest aggregate Medicare spending since launch. All but one of the top 25 drugs’ lifetime price hikes exceeded the lifetime average rate of inflation as well, with some increasing prices as much as nine times higher than inflation.

Over 100 Drugs Hiked Prices Above Inflation This Year. According to an analysis by the Center for American Progress, 112 drugs saw their list prices hiked above the annual inflation rate in July 2023, with an average rate increase of 30 percent.

1 In 3 American Adults Report Being Unable To Take Their Medications As Prescribed Due To High Costs. According to KFF, 1 in 3 American adults report being unable to take their medication as prescribed, demonstrating how high and rising drug prices are negatively impacting health outcomes for Americans struggling with affordability challenges. Existing racial and ethnic economic disparities place additional pressures on racial and ethnic minorities and make it even more challenging to keep up with drug prices rising faster than inflation.

…All While Big Drug Companies Bring In Record Profits and Reward Shareholders With Lucrative Stock Buybacks. As hundreds of drug prices rise faster than inflation, their manufacturers are bringing in record profits. Drugmakers of the first ten drugs eligible for Medicare price negotiation under the Inflation Reduction Act have made tens of billions in revenue from Medicare and other sources while spending billions of dollars on stock buybacks and lobbying. For example, Eliquis, a drug used to treat blood clots manufactured by Bristol Myers Squibb and Pfizer, has cost Medicare over $41 billion through 2021. Meanwhile, the two companies have executed more than $97 billion in stock buybacks while bringing in nearly $91 billion in global sales and spending over $172 million on lobbying since launch.

ashoup
In Fact Sheet, Research

“Medicare Autumn” Fact Sheet: Shingles Vaccines Are Now Free For American Seniors

Thanks to the Inflation Reduction Act, Medicare is better than ever and seniors can get their shingles shots and all other vaccines recommended by the CDC’s Advisory Committee on Immunization Practices, such as COVID-19, RSV, and the flu, for free. Prior to the Inflation Reduction Act, seniors could be forced to spend hundreds of dollars out of pocket for these vaccines, contributing to particularly low vaccination rates for low-income seniors, seniors of color, and rural seniors. The Inflation Reduction Act also brought down the cost of prescription medications for seniors on Medicare by capping insulin costs at $35 per month, limiting outrageous price hikes, and allowing Medicare to negotiate drug prices directly with pharmaceutical companies.

This is just the beginning: In 2025, seniors’ total drug costs will be capped at $2,000 per year and, in 2026, new savings from Medicare’s drug price negotiation will take effect. Together, these provisions will save seniors thousands of dollars on prescription drugs.

BY THE NUMBERS

  • 50.5 million American seniors can get their shingles vaccine free of cost, including over 9 million Medicare beneficiaries under 65 with disabilities, 15 million beneficiaries of color, and millions of rural beneficiaries.
  • Seniors will save up to $424 on their two-part shingles shots.
  • 84.5 million Medicaid recipients will also benefit from increased access to vaccinations.

Seniors Will Continue To Save Hundreds On Their Shingles Vaccine. Thanks to the Inflation Reduction Act, 50.5 million seniors are saving up to hundreds of dollars when getting vaccinated against shingles. With a single shot of Shingrix costing $212, seniors on Medicare Part D are saving over $400 on average on vaccinations. The cost of the shingles vaccine has been a driving factor in keeping vaccination rates especially low for the Black and Latino communities. This will level the playing field for seniors on Medicare, given that Americans on private insurance typically can get their shingles vaccines at no cost. 

33 Percent of Americans Will Develop Shingles In Their Lifetime. Shingles is a reactivation of the chicken pox virus, typically occurring in adults older than 50 years old. Symptoms include a painful rash, itching, fever, headache, chills, and nausea. The risk of shingles increases with age, making it paramount for vaccinations to be available and accessible. While complications or death from shingles is not common, seniors with weakened immune systems are particularly vulnerable, with 30 percent of shingles hospitalizations occurring within this population.

Required Vaccine Coverage For Medicaid Recipients Will Benefit Nearly 85 Million Americans. The Inflation Reduction Act also required state Medicaid and CHIP programs to cover vaccines recommended by the CDC’s Advisory Committee on Immunization Practices for no out-of-pocket costs. This allowed an estimated 4 million adults to gain access to shingles vaccines that didn’t previously have access before. Accessible vaccinations will particularly help low-income families on Medicaid, many of whom are people of color and people with disabilities, to help prevent illness and related work absences.

ashoup
In Fact Sheet, Research

“Medicare Autumn” Fact Sheet: The Inflation Reduction Act Has Lowered the Cost of Insulin for Millions of Seniors

Thanks to the Inflation Reduction Act, Medicare is better than ever and seniors will pay no more than $35 per month on insulin. President Biden and Democrats in Congress worked tirelessly to lower health care costs for seniors who have worked hard their whole lives. Too many seniors on fixed incomes have been kept at night worried about paying the bills — gas, groceries, medicines and more. This $35 cap helps millions of insulin users on Medicare afford the medicines they need to stay alive. Before the passage of the Inflation Reduction Act, too many diabetic seniors had to skip doses because of the high costs. Now thousands more seniors are able to fill their prescriptions for insulin each month. While taking insulin as prescribed reduces the likelihood of costly complications such as vision loss, heart disease, and kidney disease. 

This is just the beginning: In 2025, seniors’ total drug costs will be capped at $2,000 per year and, in 2026, new savings from Medicare’s drug price negotiation will take effect. Together, these provisions will save seniors thousands of dollars on prescription drugs. And while the Inflation Reduction Act addressed the insulin affordability crisis for seniors, Democrats in Congress are also working to extend that cap so no American will pay more than $35/month for their insulin.

WHAT THE INFLATION REDUCTION ACT’S $35 INSULIN CAP DOES FOR SENIORS WITH DIABETES

Makes Insulin Accessible and Affordable For Seniors. In 2020, there were more than 3.2 million insulin users on Medicare Part D, with nearly 1.7 million purchasing their insulin without low-income subsidies. On average, seniors with Medicare Part D who are not receiving subsidies pay an average of $572 every year for this life saving medication — an unthinkable sum for many on fixed incomes. Under the Inflation Reduction Act, insulin copays for seniors on Medicare are now capped at $35 each month.

Thousands More Seniors Are Filling Their Insulin Prescriptions. The Inflation Reduction Act’s cap on insulin copays has led to increases in the total number of insulin prescriptions filled for Medicare beneficiaries. A study from the USC Schaeffer Center for Health Policy & Economics and University of Wisconsin–Madison found that following the cap’s enactment in January 2023, the number of insulin fills among Medicare Part D enrollees increased from 519,588 to 523,564 per month.

Rural Seniors Are Able to Access Affordable and Quality Care. According to a 2018 study, rural Americans are 17 percent more likely to suffer from diabetes than urban Americans. Diabetes risk factors are higher in rural areas than their urban and suburban counterparts as they have limited access to health care providers, fewer transportation options to receive care, and higher rates of being uninsured. These seniors are forced to stop taking their medication or cut doses in half. Diabetics suffer severe effects such as numbness in feet and nerve damage in the eyes when they stop taking doses as prescribed. Patients who suffer chronic complications can expect to pay upwards of an additional $650 per year. The insulin cap provision in the Inflation Reduction Act vastly improves the lives of millions of these vulnerable insulin users.

Americans Of Color Are Disproportionately Affected By Diabetes. Deaths related to diabetes are three times more likely among people of color than their white counterparts. Over 12 percent of Americans of color experience diabetes due to a combination of genetic, socioeconomic, and environmental risk factors.  11.8 percent of Hispanic adults have diabetes and are 50 percent more likely to develop type 2 diabetes over the course of their lifetime than their white counterparts. Racial and ethnic minority populations are also at a higher burden of diabetes-related complications, such as kidney disease, blindness, and worse glycemic control. Despite the higher risk of complications, Americans of color are less likely to receive recommended preventive care and annual screenings, largely as a result of systemic access barriers to this care. Americans of color spend upwards of $10,000 a year on diabetes-related costs. 

Americans Of Color Skip, Ration, Or Delay Insulin Doses At Higher Rates Than Their White Counterparts. With rates of uninsurance also being highest among people of color, these insulin users are at a higher risk of skipping, rationing, or delaying insulin doses. Nearly 24 percent of Black Americans ration insulin compared to 16 percent of their white and Hispanic counterparts. Black adults also continue to be the hardest hit when it comes to affording their prescription drugs and paying medical bills. The Inflation Reduction Act’s insulin cap is promoting health equity by expanding access and increasing affordability for diabetic seniors of color so much so that the prevalence of skipping doses is already beginning to fall. 

REPUBLICANS ARE FIGHTING TO KEEP INSULIN PRICES HIGH

Republicans Blocked Insulin Cap for Millions of Americans. As the final negotiations were being made on the Inflation Reduction Act, Republicans in the Senate unified together to make sure that the $35 insulin cap was not universal. In a country where 80 percent of diabetics have had to go into debt in order to pay for insulin, this type of action by Republicans reeks of the influence of Big Pharma. An additional 21 million insulin users of all ages would have benefited from this universal program, including the nearly 300,000 young people under 20 who are diagnosed with diabetes. 1 in 5 people with private insurance pays more than $35 per month and, for people who are uninsured or have poor coverage, insulin can cost up to $1,000 per month. A striking 14 percent of insulin users spend catastrophic amounts, or at least 40 percent of their income, on insulin. The Affordable Insulin Now Act, which will build upon the gains of the Inflation Reduction Act, is supported widely by Democrats but has been continually shot down by Republican legislators.

ashoup
In Fact Sheet, Research

“Medicare Autumn” Fact Sheet: American Seniors Will Save As Medicare Negotiates Lower Drug Costs

Protect Our Care launched a new campaign, “Medicare Autumn,” to educate seniors on how Medicare is better than ever. Thanks to the Medicare Drug Price Negotiation Program included in the Inflation Reduction Act, Medicare now has the ability to negotiate drug prices to lower costs for seniors on Medicare. The Biden administration recently announced the first round of high-cost drugs whose prices will come down from negotiation. This includes some of the highest-priced prescription drugs used to treat conditions like diabetes, heart disease, cancer, arthritis, chronic kidney disease, psoriasis, Crohn’s disease, and ulcerative colitis – many of which disproportionately impact women, communities of color, and people in rural areas. 

For too long, Americans have been paying three to four times more than people in other countries for the prescription drugs they depend on, forcing people to choose between filling a prescription or filling their refrigerator. Giving Medicare the power to negotiate with drug companies will help bring the price of medicines in the U.S. more in line with what other countries pay.

The impact of lower prescription drug costs thanks to the Inflation Reduction Act will be felt by people across the country. Negotiating lower prices on certain popular high-cost drugs will help:

  • 3,505,000 Americans who pay an average of $441 out-of-pocket per year for Eliquis, sold by Bristol Myers Squibb, to treat blood clots.
  • 47,000 Americans who pay an average of $921 out-of-pocket per year for Enbrel, sold by Amgen, to treat arthritis and psoriasis. 
  • 521,000 Americans who pay an average of $357 out-of-pocket per year for Entresto, sold by Novartis, to treat heart failure. 
  • 639,000 Americans who pay an average of $260 out-of-pocket per year for Farxiga, sold by AstraZeneca to treat diabetes.
  • 763,000 Americans who pay an average of $121 out-of-pocket per year for Fiasp/NovoLog, sold by Novo Nordisk, to treat diabetes. 
  • 22,000 Americans who pay an average of $5,247 out-of-pocket per year for Imbruvica, sold by AbbVie, to treat blood cancers. 
  • 885,000 Americans who pay an average of $270 out-of-pocket per year for Januvia, sold by Merck, to treat diabetes. 
  • 1,321,000 Americans who pay an average of $290 out-of-pocket per year for Jardiance, sold by Boehringer Ingelheim, to treat diabetes. 
  • 20,000 Americans who pay an average of $2,058 out-of-pocket per year for Stelara, sold by Johnson & Johnson, to treat psoriasis and Crohn’s disease.
  • 1,311,000 Americans who pay an average of $451 out-of-pocket per year for Xarelto, sold by Johnson & Johnson, to treat blood clots.

Drug Price Negotiation Improves Other Medicare Benefits. As a result of Medicare negotiation negotiations, Americans with Medicare will have access to innovative, life-saving treatments at lower prices, translating into lower premiums and out-of-pocket costs for older Americans and producing savings that are being used to improve benefits, including: 

  • a new $35 cap on monthly insulin prescriptions; 
  • free recommended vaccines;
  • a $2,000 annual cap on prescription drug costs taking effect in 2025.

The First 10 Drugs Are Just The Beginning. Negotiations will occur over the coming year and new, lower prices will be announced by September 1, 2024, and take effect in 2026. The first ten drugs that will see lower prices are responsible for about 20% of total Medicare Part D prescription drug costs every year. The companies that market them have made more than $493 billion in revenue from these drugs. Medicare will negotiate lower prices for an additional 15 drugs for prices effective in 2027, and by 2029, Medicare will negotiate lower prices for 20 drugs per year. And President Biden and Democrats in Congress are already working to expand these cost savings to more Americans, no matter what age they are or how they get their health coverage. 

Medicare Drug Price Negotiation Is Overwhelmingly Popular. Negotiating lower prices is overwhelmingly popular across the country, yet big drug companies are suing the federal government to protect their massive profits by halting the program. A recent Hart Research poll shows that 96 percent of Americans agree that lowering drug prices “is an important way to help people afford the cost of living,” and nearly three-quarters of Americans favor Medicare negotiation. Meanwhile, pharmaceutical companies’ arguments against negotiation are overwhelmingly rejected by the American people.

Big Drug Companies Are Threatening To Keep Drug Prices High Through The Courts. Drug company giants including Merck, Bristol Myers Squibb, Johnson & Johnson-owned Janssen Pharmaceuticals, Boehringer Ingelheim, AstraZeneca, and Novartis, as well as mega lobbying groups PhRMA and the US Chamber of Commerce, have sued the federal government in an effort to stop Medicare from negotiating for lower prescription drug prices for Medicare beneficiaries. If the big drug companies get their way patients will pay more so the drug companies can make more money:

  • GONE: Medicare’s power to negotiate lower prices for the most popular and expensive prescription drugs. Under the Inflation Reduction Act, Medicare is set to begin negotiating prices for 10 of the top 50 most expensive Part D drugs in 2026, adding another 15 drugs in 2027 and 2028, and another 20 in 2029 and subsequent years.
  • GONE: $98.6 billion in Medicare savings over the next decade from the drug negotiation program, which translates into savings for patients and taxpayers.
  • GONE: Lower Part D premiums and lower out-of-pocket drug costs for certain Medicare beneficiaries who rely on qualifying drugs.

The plaintiffs assert several sweeping claims, including under the First Amendment, the Fifth Amendment, and the Eighth Amendment across the lawsuits, but experts agree that these meritless arguments are merely an attempt to maintain the status quo where drug companies can protect their massive profits by charging whatever they want at the expense of patients and taxpayers.

ashoup
In Fact Sheet, Research

FACT SHEET: Medicare Open Enrollment Brings New Benefits and Savings for Millions of Seniors

Seniors Will Save in 2024 Thanks to the Inflation Reduction Act: Lower Drug Costs, Monthly Insulin Cost Cap, and Free Vaccines 

Medicare open enrollment began on October 15 and runs through December 7. Millions of seniors will begin selecting their coverage for 2024. It is important that seniors understand the savings available to them as they make decisions about enrolling in a Medicare plan.

As Medicare beneficiaries review plans for 2024, seniors will see new benefits thanks to the Inflation Reduction Act’s measures to drive down drug costs. As they did during the 2023 Medicare open enrollment, seniors will see lower premiums for prescription drug coverage. As of January 1, 2023, critical vaccines are now free, monthly insulin costs are capped at $35 per prescription, and drug companies cannot take advantage of seniors by raising drug prices faster than the rate of inflation. Additionally, in the years ahead, Medicare beneficiaries will see lower drug prices across the board thanks to the Inflation Reduction Act’s provisions to give Medicare the power to negotiate and cap out-of-pocket drug costs at $2,000 a year. This translates to thousands of dollars in savings for millions of seniors and people with disabilities nationwide. 

BY THE NUMBERS: Seniors Will Pay Less for Health Care

The Inflation Reduction Act is drastically reducing the cost of prescription drugs for the more than 50 million Americans enrolled in Medicare’s Part D drug benefit, reducing racial, income, and geographic disparities in health care, and saving lives. Seniors will no longer have to choose between paying for the drugs they need and other essentials like food and housing.

By the Numbers:

  • Over 50 million Medicare beneficiaries no longer face big drug companies’ outrageous price hikes that exceed inflation. 
  • All Medicare Part D beneficiaries have access to covered vaccines, such as shingles and pneumonia, at no cost.
  • No Medicare beneficiary pays more than $35 a month for an insulin copay.
  • Over 50 million Medicare Part D beneficiaries will have out-of-pocket costs for prescription drugs capped at $2,000 per year beginning in 2025. 
  • Lower prices are being negotiated for the first 10 drugs selected for the Negotiation Program, with more drugs to be named each year. The first ten drugs are Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and Fiasp/NovoLog.
  • Premiums for the average Medicare Part D plan are decreasing by 1.8 percent in 2024.

The Inflation Reduction Act Lowers Prescription Drug Prices

Medicare Negotiation For Lower Drug Prices. The Biden administration is implementing the Medicare Drug Price Negotiation Program which is supported by over 80 percent of Americans — the most popular provision in the Inflation Reduction Act. In August, the first round of high-cost drugs that will be negotiated was announced: Eliquis, Jardiance, Xarelto, Januvia, Farxiga, Entresto, Enbrel, Imbruvica, Stelara, and Fiasp/ NovoLog. These high-cost drugs treat conditions like cancer, diabetes, and blood clots. The first ten drugs selected for negotiation are taken by nearly 9 million people on Medicare, who spent $3.4 billion in out-of-pocket costs last year alone.  The negotiated prices will be effective starting in 2026. 

Game-Changer For Insulin-Dependent Seniors. In 2020, there were more than 3.2 million insulin users with Medicare, with nearly 1.7 million purchasing their insulin without low-income subsidies. On average, seniors with Medicare Part D or B who are not receiving subsidies pay an average of $572 every year for this life-saving medication — an unthinkable sum for many on fixed incomes. Patients who suffer chronic complications can expect to pay upwards of an additional $650 per year. Under the Inflation Reduction Act, insulin copays for people on Medicare are capped at $35 per prescription each month. A recent study showed that 1.5 million people on Medicare would have saved an average of $500 in 2020 from the $35 insulin copay cap.

Ends Outrageous Price Increases For Seniors. The Inflation Reduction Act penalized drug companies for raising drug prices faster than the rate of inflation starting at the beginning of 2023. An analysis by KFF showed that half of all drugs covered by Medicare had list price increases exceeding the rate of inflation in 2020. For example, Humira, a medication commonly used to treat rheumatoid arthritis, is one of the nation’s highest revenue-generating drugs, raking in $21 billion in sales in 2019. AbbVie, Humira’s manufacturer, has hiked the price of Humira 27 times, including in January 2021 when it raised its cost by 7.4 percent. Over the past 20 years, price increases for brand-name drugs in Medicare Part D have risen at more than twice the rate of inflation. 

Free Shingles Vaccinations. Thanks to the Inflation Reduction Act, 50.5 million seniors are eligible for no-cost shingles vaccinations. In 2020, nearly 4 million Medicare beneficiaries received the two-part shingles vaccination. With a single shot of Shingrix costing $212, seniors on Medicare Part D are saving over $400 on average on vaccinations in 2023. The high out-of-pocket cost of the shingles vaccine has been a key factor in low vaccination rates, especially among Black and Latino communities. This extends an important affordable preventive service to seniors on Medicare; Americans with private insurance could already typically receive shingles vaccinations at no cost.

ashoup
In Research, Fact Sheet

FACT SHEET: GOP Legislation to Promote HSAs Gives a Boost to the Wealthy While Undermining Affordable Coverage

As Republicans are on the verge of forcing a reckless government shutdown, they are once again considering legislation to promote the use of health savings accounts (HSA), which overwhelmingly benefit high-income people. This legislation incentivizes the expansion of HSAs through tax breaks, rewarding the highest-paid workers while worsening racial and ethnic inequities in health care. This comes as Republicans are working to repeal the Inflation Reduction Act, raise prescription drug prices, and throw millions off of Medicaid. Once again, Republicans prove they are dead set on prioritizing tax breaks for the wealthy over helping people get the health care they need. 

HSAs Make Health Care Less Accessible And Affordable. Republican efforts to promote the use of HSAs directly undermines the ACA’s goals to make quality health care more accessible and affordable for all Americans. The promotion of employer-sponsored high-deductible health plans that use HSAs increases the cost of health care for employees and continues the difficult decisions low-income working families have to make between putting food on the table or paying for medical care. 

HSAs Benefit The Wealthy. HSAs largely benefit high-income individuals. Contributions to HSAs are not taxed, which helps wealthy people decrease their taxable income and avoid paying their fair share. These contributions can also be invested in stocks and bonds to accrue tax-free earnings that carry over year to year — further exacerbating the wealth gap.

HSAs Do Not Make Care More Affordable for Low-Income Individuals. HSAs do not benefit low-income individuals as they often do not have the ability to contribute to HSAs and need to use their available income to pay for medical bills and care upfront. Nearly 70 percent of adults under 200 percent of the poverty line would not have been able to pay a $1,000 medical bill within 30 days in 2022, let alone contribute to a HSA. Low-income individuals also do not benefit as much from tax-free earnings as high-income individuals due to the lower amount of tax deductions from being in a lower income tax bracket. Employers who offer high deductible health plans, where HSAs are necessary, typically contribute little to nothing to their employees’ HSAs. 

HSAs Exacerbate Racial And Ethnic Inequities In Health Care. Black and Latino people with private insurance are half as likely to have HSAs as white and Asian people. Per the Center on Budget and Policy Priorities: “Against a backdrop of long-standing racial disparities in wealth — a typical white family in 2019 had eight times the wealth of a typical Black family and five times the wealth of a typical Latino family — HSAs provide preferential tax treatment that is disproportionately out of reach for people of color.”

HSAs Cost The Government Billions. HSAs will cost the government $182 billion between 2023 and 2032. Meanwhile, the cost of President Biden’s plan for permanently closing the Medicaid coverage gap or permanently extending marketplace coverage premium tax credits over the next 10 years would cost roughly the same amount at $200 billion and $183 billion respectively. Unlike the bills to expand HSAs, Medicaid expansion and marketplace premium tax credits would allow millions of uninsured individuals to gain quality coverage.

ashoup
In Fact Sheet, Research

FACT SHEET: How Medicare’s New Drug Price Negotiation Power Will Advance Health Equity

On August 29, the Biden administration announced the first round of high-cost drugs whose prices will come down as Medicare negotiates with the drug companies – a new power they have under the Inflation Reduction Act. This new program will lower prices for some of the highest-priced prescription drugs on the market used to treat conditions like diabetes, heart failure, blood clots, and autoimmune disorders – conditions that disproportionately impact women, communities of color, and people in rural areas. The Inflation Reduction Act was championed by President Biden and Democrats in Congress to lower health care costs for people across the nation. 

The first ten drugs selected for negotiation are taken by nearly 9 million people on Medicare and account for about 20 percent of annual Medicare Part D spending. CMS will negotiate lower prices with manufacturers of these drugs, and those prices will take effect in 2026. The drugs are:

  1. Eliquis which is manufactured by Bristol Myers Squibb and Pfizer to treat blood clots
  2. Enbrel which is manufactured by Amgen to treat rheumatoid arthritis, psoriasis, and psoriatic arthritis
  3. Entresto which is manufactured by Novartis to treat heart failure 
  4. Farxiga which is manufactured by AstraZeneca to treat diabetes, heart failure, and kidney disease
  5. Fiasp, also known as NovoLog, which is manufactured by Novo Nordisk to treat diabetes
  6. Imbruvica which is manufactured by AbbVie and Johnson & Johnson to treat leukemia and lymphoma 
  7. Januvia which is manufactured by Merck to treat diabetes
  8. Jardiance which is manufactured by Boehringer Ingelheim and Eli Lilly to treat diabetes
  9. Stelara which is manufactured by Johnson & Johnson to treat psoriasis, psoriatic arthritis, Crohn’s disease, and ulcerative colitis
  10. Xarelto which is manufactured by Johnson & Johnson’s Janssen Pharmaceuticals and Bayer to treat blood clots

The Medicare Drug Price Negotiation Program advances health equity in two key ways: 

First, the Negotiation Program will lower drug prices for certain high-cost drugs, which will reduce out-of-pocket costs for Medicare enrollees. Since Black, Latino, women, LGBTQI+, and disabled people on Medicare are more likely to have lower incomes and less savings, reducing prescription drug costs will be especially impactful for their financial security and access to care. Lowering prices through negotiation is one of several ways the law reduces prescription drug costs for Medicare enrollees. Others include: capping monthly copays for insulin at $35, providing vaccines at no cost, limiting annual out-of-pocket spending in Part D to $2,000, which will save seniors with high drug costs over $400 per year, and making the Medicare Extra Help program available to more low-income seniors, reducing their premiums and copays for medication. 

Second, negotiating lower prices for the selected drugs will make drugs that are disproportionately needed by historically marginalized communities more affordable and accessible. The ten drugs selected by Medicare for lower negotiated prices treat a number of conditions that disproportionately impact people of color, and Medicare enrollees of color are more likely than the general Medicare population to take six of the ten selected drugs. Of the ten drugs selected by Medicare, eight treat conditions that disproportionately impact people of color including diabetes, heart failure, chronic kidney disease, blood clots, arthritis, and blood cancer (see Table 1). Additionally, six of the ten drugs are taken by a disproportionate number of Black, Latino, Asian, and/or American Indian/Alaska Native Medicare enrollees relative to the Medicare population as a whole (see Table 2), including

  • Enbrel is taken by a higher percentage of Latino enrollees and American Indian/Alaska Native enrollees than their proportion of the Medicare population. 
  • Entresto is taken by a higher percentage of Black enrollees than their proportion of the Medicare population. 
  • Farxiga is taken by a higher percentage of Black enrollees, Latino enrollees, and Asian American enrollees than their proportion of the Medicare population.
  • Fiasp/NovoLog is taken by a higher percentage of Black enrollees, Latino enrollees, and American Indian/Alaskan Native enrollees than their proportion of the Medicare population.
  • Januvia is taken by a higher percentage of Black enrollees, Latino enrollees, and Asian American enrollees than their proportion of the Medicare population. 
  • Jardiance is taken by a higher percentage of Black enrollees, Latino enrollees, Asian American enrollees, and American Indian/Alaskan Native enrollees than their proportion of the Medicare population.

Negotiating lower prices remains overwhelmingly popular among voters of all parties across the country. Unfortunately, big drug companies are suing the federal government to halt the program and protect their massive profits, and Republicans are attempting to repeal the Inflation Reduction Act in its entirety, placing these equity-advancing improvements at risk.

Table 1: Demographic Impact of Conditions Treated by Drugs Selected for Negotiation

Race/EthnicityConditionsSelected Drugs
Black Non-LatinoWhen compared to White non-Latinos, Black non-Latinos are:

  • 60 percent more likely to be diagnosed with diabetes and twice as likely to die from diabetes.
  • 2.5 times more likely to be hospitalized with diabetes and associated long-term complications than White Americans.
  • 3.2 times more likely to be diagnosed with end-stage renal disease.
  • 30 percent more likely to die from heart disease.
  • 30 percent more likely to have high blood pressure, and less likely to have their blood pressure under control.
  • 30% to 100% more likely to experience blood clots.
Eliquis (blood clots)
Entresto (heart failure)
Farxiga (diabetes; heart failure; chronic kidney disease)
Fiasp/ NovoLog (diabetes)
Januvia (diabetes)
Jardiance (diabetes; heart failure)
Xarelto (blood clots)
LatinoWhen compared to White non-Latinos, Latinos are:

  • 70 percent more likely to be diagnosed with diabetes and 1.3 times more likely to die from diabetes.
  • Twice as likely to be hospitalized for treatment of end-stage renal disease related to diabetes.
  • More likely to have higher levels of disability-related diabetes (3.2%) and hypertension (2.7%).
  • Among the most likely to have activity limitations due to arthritis of any racial group other than American Indian/Alaska Natives.
Enbrel (rheumatoid arthritis; psoriasis; psoriatic arthritis)
Farxiga (diabetes; heart failure; chronic kidney disease)
Fiasp/ NovoLog (diabetes)
Januvia (diabetes)
Jardiance (diabetes; heart failure)
Asian AmericanWhen compared to White non-Latinos, Asian Americans are:

  • 40 percent more likely to be diagnosed with diabetes.
  • 60 percent more likely to be diagnosed with end-stage renal disease.
Farxiga (diabetes; heart failure; chronic kidney disease)
Fiasp/ NovoLog (diabetes)
Januvia (diabetes)
Jardiance (diabetes; heart failure)
American Indian / Alaska NativeWhen compared to White non-Latinos, American Indian/Alaska Natives are:

  • Nearly three times more likely to be diagnosed with diabetes and 2.3 times more likely to die from diabetes.
  • Twice as likely to be diagnosed with end-stage renal disease.
  • 50 percent more likely to be diagnosed with coronary heart disease.
  • Most likely to have activity limitations due to arthritis of any racial group.
Enbrel (rheumatoid arthritis; psoriasis; psoriatic arthritis)
Entresto (heart failure)
Farxiga (diabetes; heart failure; chronic kidney disease)
Fiasp/ NovoLog (diabetes)
Januvia (diabetes)
Jardiance (diabetes; heart failure)

Table 2: Drugs Selected for Negotiation Disproportionately Taken by Medicare Enrollees of Color

Race/EthnicityMedicare Part D Pop.JardianceJanuviaFarxiga EntrestoEnbrelFiasp/ NovoLog*
Black Non-Latino10.7%14%16%16%18%11%17%
Latino10.1%13%16%14%9%14%11%
Asian American3.7%6%7%6%3%3%3%
American Indian/Alaska Native0.3%1%>0%>0%>0%1%1%

*the full drug name is Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill

Click here for a PDF of the tables and links.

ashoup
In Fact Sheet, Research

FACT SHEET: Republicans’ Latest Proposals Raise Health Care Costs, Take Away Coverage From Millions, And Starve Vital Health Programs

GOP War on Health Care Alive and Well

Republicans are at it again – attacking health care on multiple fronts. They want to hike costs and rip away care from millions of Americans in their latest budget proposal, including taking away Medicare’s power to negotiate lower drug prices for seniors. They are threatening a reckless government shutdown that would only make matters worse, and proposed a continuing resolution that would compound the growing health crises as it seeks to cut 8 percent of almost all federal spending. And the legislation they are championing in the House would send us back to the days when insurance companies could make the rules and weaken protections for preexisting conditions. If the GOP gets their way, they would throw millions of people off of Medicaid, reverse prescription drug savings for seniors under the Inflation Reduction Act, and make health care coverage more expensive for families purchasing coverage on their own through the Affordable Care Act. 

Here’s a closer look at what the GOP is proposing;

The Budget Details 

What The Republican Budget Proposal Means for Americans: 

  • GONE: Medicare’s power to negotiate lower prices for the most expensive prescription drugs.
  • GONE: Premium savings for 14.3 million Americans who buy insurance on their own — averaging $2,400 per family.
  • GONE: Medicaid for millions of Americans including people with disabilities, new mothers, and children who can’t meet the bureaucratic paperwork burdens imposed by a work requirement. 
  • GONE: Nearly $4 billion in funding for research on cancer, Alzheimers, and long COVID.
  • GONE: Over $500 million in savings under the Affordable Care Act.

Medicare’s Price Negotiation Power Will Be Stripped Away by Republicans. Currently, negotiations are underway for ten drugs that make up around 20 percent of all Medicare Part D spending. Americans currently pay two to four times more for prescriptions than people in other countries and if Republicans have their way it will stay like that. The Arrington budget would slash Medicare’s power to negotiate and make sure prices stay high for Americans and federal spending is needlessly inflated.

Republicans Want to Make Health Care More Expensive For Millions By Repealing The Inflation Reduction Act’s Premium Subsidies. House Budget Chair Jodey Arrington’s budget proposal would scrap the Inflation Reduction Act’s premium subsidies, which has helped save over 13 million Americans an average of $2,400 per year on health care. It also ensures that no individuals making under $20,000 or families making around $41,000 will have to pay health care premiums at all. These subsidies have led a record breaking 14.3 million people to enroll in affordable health plans. The Republican plan will cause over 3 million people to lose coverage entirely. 

Medicaid Work Requirements Would Kick Millions of Americans, Including Mothers and Children, Off of Rolls. Despite all evidence and case studies showing that implementing work requirements on Medicaid kicks off people who do meet the work requirement but can’t jump through the additional bureaucratic reporting hoops and increases the program’s total costs due to increased administrative oversight, Republicans have proposed an 80 hour a month work requirement for Medicaid. Over 60 percent of Medicaid enrollees already work, so an additional work requirement will likely only kick off the 11 percent not able to work due to illness or disabilities, 13 percent not able to work due to caregiving, and 6 percent not able to work due to school attendance. This program will leave disabled Americans, those caring for families, the children of parents who have lost coverage, and those seeking education to better their job opportunities in the future without care.

Critical Research into Cancer, Alzheimers, Long COVID, and Other Diseases Will Be Halted. Republicans plan to cut over $3.8 billion in funding to the National Institute of Health and eliminate funding entirely for the Agency for Healthcare Research and Quality. With NIH funding accounting for 99.4 percent of all FDA approved drugs from 2010-2019, these cuts will significantly undermine novel pharmaceutical innovation and development.

Repealing Bans on Physician Self-Referral Will Increase Health Care Costs and Jeopardize Communities’ Access to Care. In the FY 2024 budget, House Republicans have proposed ending the Stark Law, which would allow physicians to self-refer patients to facilities and services in which they have a financial stake. Importantly, these controversial physician-owned hospitals provide limited or no emergency services, cherry pick the most potentially profitable patients, and incur significantly higher costs on the Medicare program. According to the HHS, up to one-third of these hospitals may violate Medicare requirements by relying on publicly funded services to stabilize patients while still charging the patients exorbitantly. The Affordable Care Act’s closing of the “whole hospital” exception loophole in the Stark Law reduced the federal deficit by half a billion dollars over ten years; Republicans repealing it will cost the federal government and the American people millions of dollars annually.

If Republicans Shut Down the Government Or Fail To Reauthorize Critical Health Programs

If Republicans don’t get their way to cut Medicaid, the Affordable Care Act, and the Inflation Reduction Act, it is more and more likely that they will shut down the entire federal government. Along with crucial federal programs not being funded during a shutdown, there are a range of other health initiatives that need to be reauthorized before the end of fiscal year 2023 on September 30, which Republicans are also neglecting to prioritize. Instead of governing, it seems the Republican party seeks to hold the entire American health care system hostage.

Over 300 Community Health Centers Will Be At Risk. The Community Health Center Fund provides around 70 percent of federal funding to over 300 grantees across the country running vital health centers which integrate local health equity efforts into broader health care. The funding for this program expires September 30th, and without additional resources the lapse in funding could cause a collapse in employment in these centers.

Federal Funding That Offsets Uncompensated Care Hospitals Provide Will Dry Up. In a letter sent by America’s Essential Hospitals, the group warned that the $8 billion cut to DSH payments, which would go into effect on October 1, could dramatically undermine America’s health and safety. As well without this funding, access to life-saving services could disappear for many low-income or otherwise marginalized Americans.

The Global Fight Against HIV/AIDS Will be Undermined. A government shutdown could cause The President’s Emergency Plan for AIDS Relief (PEPFAR) to not be reauthorized. This will sunset seven provisions at the end of fiscal year 2023 which involve how to allocate spending and U.S. contributions to the Global Fund to Fight AIDS, Tuberculosis and Malaria.

Funding the Fight Against the Opioid Epidemic Would Dry Up. Without reauthorization, many programs launched in 2018 aimed at tackling the growing opioid crisis would lapse.

Pandemic Preparedness Would Collapse and Drug Shortages Continue. Due to an ongoing fight in the House, Republicans have held up reauthorizing the Pandemic and All Hazards Preparedness Act (PAHPA). Democrats have fought to address the growing drug shortages using the PAHPA, but Republicans have delayed the reauthorization, now causing it to potentially lapse out entirely due to a Republican shutdown.

The Republican Continuing Resolution Would Only Make Matters Worse

A Short Term CR Offered By Some Republicans Would Slash Federal Spending And Undermine Critical Research And Public Health Programs. Instead of shutting down the government, some Republicans have offered up a short-term funding bill which will keep the federal government running until October 31st. This continuing resolution will only compound the growing health crises as it seeks to cut 8 percent of almost all federal spending. Not only will these cuts increase wait times, slash public spending on disaster initiatives, and undermine critical pharmaceutical research, but it will also drastically decrease access to vital public health services as tens of thousands of Americans face obstacles in maintaining stable social determinants of health.

Republican Legislation Would Weaken Protections For Millions Of Americans With Pre-Existing Conditions

Legislation Offered By Republicans This Summer Would Promote “Junk” Insurance Plans And Undermine the ACA. The Association Health Plans Act and Self Insurance Protection Act passed by the Education & Workforce Committee this summer would expand access to association health plans (AHPs) and other non-ACA compliant health care plans, weakening protections for the over 135 million Americans with pre-existing conditions. AHPs are health plans that are offered to members of trade associations, professional groups, or other organizations. Compared to plans available on state marketplaces, AHPs provide weaker cost and protection coverage and are not required to hold up the same protections that plans under the ACA do. AHPs do not have to participate in the ACA’s single-risk pool rule and can set premiums lower for healthier people and higher for those with pre-existing conditions or who are at risk for health issues in the future.

ashoup
In Research, Fact Sheet

FACT SHEET: Republicans Continue To Promote Junk Plans That Have a History of Fraud & Are Dangerous For Patients

Republicans Promoting Junk Plans are Putting Big Insurance Company Profits Before Patients Once Again

This month, President Biden announced plans to rein in junk plans like short-term, limited-duration insurance (STLDI) plans that were previously expanded and promoted by the Trump administration. The fact of the matter is simple: junk plans engage in predatory marketing practices, fail to protect people with pre-existing conditions, and put patients at risk of bankruptcy when they get sick.

In 2018, the Trump administration changed the rules to allow these plans to be sold like regular insurance and gutted funding for advertising Affordable Care Act (ACA) marketplace plans — to disastrous effect. Far from promoting “consumer protection” and “consumer choice,” the Trump administration exposed consumers to scams and reduced transparency about coverage limits and hidden fees. These plans are particularly harmful for communities of color and other marginalized groups who are more likely to have poorer health and to be living in poverty. 

While some conservative voices claim that ending these rules could leave some uninsured, the Biden administration and Democrats in Congress have expanded access to no- or low-cost ACA coverage and funded outreach and enrollment so people are more likely to enroll in coverage that protects pre-existing conditions and less likely to get ripped off. Nearly 16.4 million people are enrolled in Marketplace coverage, including plans costing as little as $0 and $10/month. As the Biden administration works to lower health care costs and regulate these junk plans, Congressional Republicans are passing legislation to weaken protections for millions of people with pre-existing conditions and boost health insurance plans that aren’t required to cover prescription drugs or hospital care.

The Trump Administration Expanded Junk Plans and Gutted Funding For Advertising ACA Plans, Putting Consumers At Risk

The Trump Administration Cut Critical ACA Health Subsidies & Enabled Greater Access To Short-Term, Limited Duration Insurance (STLDI) Plans That Did Not Meet ACA Requirements. In late 2017, after Congressional Republicans’ efforts to repeal and replace the Affordable Care Act (ACA) failed to advance, then-President Trump ordered sweeping changes to health insurance with a pair of executive actions. He first announced that the sale of certain cheap policies with few benefits or protections – known as short-term, limited-duration insurance (STLDI) – would be allowed to be sold for up to 364 days with renewals for up to three years instead of three months, then announced cuts to critical health subsidies helping pay out-of-pocket costs for low-income people in America. In response, many patient and physicians groups raised concerns that junk plans would “cause significant economic harm to women and older, sicker Americans who stand to face higher-cost and fewer insurance options,” and “draw younger and healthier people away from the exchanges and drive additional plans out of the market.” The changes were solidified in August 2018 as a final rule allowing STLDI plans to be considered a form of individual health insurance coverage that would meet the ACA’s individual mandate.

Junk Plans Enabled By The Trump Administration Have Left Patients Without Protections For Pre-existing Conditions Afforded By the ACA. “Because they tend to look less expensive up front, short-term plans continue to find buyers, and they have been championed by the Trump administration (which has loosened restrictions on them) as an alternative for consumers. […] Consumer advocates have long sounded alarm bells about short-term plans and others that don’t comply with the Affordable Care Act rules — rules that require plans to provide comprehensive benefits to all comers, regardless of their health. The ACA also prohibits annual or lifetime dollar limits on coverage for any plan sold on the federal or state health insurance exchanges.” [NPR, 12/3/20]

Patient Advocacy Groups, Health Policy Experts, and Insurance Insiders Alike Have Warned Against Junk Plans’ Lack of Transparency and Coverage. Patient advocacy groups and health policy experts have long warned about the fraud risks that come with STLDI and other non-ACA-compliant plans. In January 2019, the Georgetown University Health Policy Institute found that consumers searching online for ACA-compliant plans were often directed, instead, to “junk plans.” Another study sponsored by the Leukemia and Lymphoma Society found that junk plans often rely on misleading marketing, are often misunderstood by consumers who purchase them with no right to appeal plan decisions, drive up patients’ out-of-pocket costs, and “threaten prices across the insurance market.” In March 2021, 30 patient organizations published a report pushing for greater regulation of dozens of different types of “junk insurance,” including STLDI plans. Even health insurance industry insiders have warned that the “very profitable” plans are inadequate, and state insurance regulators have expressed concerns that STLDI plan administrators have been misleading and taking advantage of consumers while offering substandard coverage.

Ever Since The Trump Administration’s Rule Change, Junk Plans Have Attracted Fraud. Following the Trump administration’s rule change, health insurance companies across the country began offering STLDI plans to consumers. Shortly after the rule took effect, federal officials shut down numerous “ruinous” health insurance plans that falsely claimed to provide comprehensive health insurance, with one commissioner describing them as a “classic bait-and-switch scheme designed to trick consumers.” 

  • 2022: A Florida-Based Health Insurance Company That Scammed Patients was Forced To Refund $100 Million After An FTC Investigation. One company, Health Insurance Innovations Inc. (later known as Benefytt Technologies), began using junk plans to scam consumers into paying exorbitant fees, often without their permission, for little coverage using deceptive websites such as “Obamacareplans.com.” In 2022, the Federal Trade Commission ordered the company to pay $100 million in refunds to customers who fell victim to the scam.

The Biden Administration Has Worked To Promote Informed Consumer Choice By Expanding Access To ACA Marketplace Plans And Launching Outreach Campaigns

The Biden Administration Has Expanded Critical Health Subsidies Allowing Millions of People To Access No- or Low-Cost ACA Plans. “Low-income Americans who missed signing up for 2022 Affordable Care Act coverage can now enroll in plans with $0 premiums through the federal exchange’s website. Those with incomes less than 150% of the federal poverty level – $19,320 for an individual and $39,750 for a family of four – can select policies on healthcare.gov through a special enrollment period, the Centers for Medicare and Medicaid Services told CNN exclusively on Monday. Most people will be able to select plans with no premiums, while others may have to pay a few dollars. 

The Biden Administration Has Promoted Informed Consumer Choice By Launching Advertising and Outreach Campaigns About Expanded ACA Access. “The agency is launching advertising and outreach campaigns to spread the word about the new special enrollment period, which lasts for the rest of the year. The effort will also target those experiencing certain life changes, such as losing job-based coverage, getting divorced or aging out of a parent’s policy, which have always allowed them to sign up for Obamacare policies during the year.” [CNN, 3/21/22]

While The Biden Administration Works To Lower Costs, Congressional Republicans Are Passing Legislation To Boost Junk Plans

The Biden Administration Is Working To Close Trump-Era Loopholes That Have Propped-Up Junk Plans. The Biden administration has worked to lower health care costs and crack down on “junk plans” like STLDI, proposing new rules closing Trump-era loopholes allowing health insurance companies to mislead patients and sell plans that provide very limited coverage. Under the new rules, STLDI plans will be limited to a maximum of 3 months – instead of 3 years as was allowed under the Trump administration – and will be required to disclose benefit limits as well as potential exposure to exorbitant surprise fees that disproportionately impact lower-income households and people of color.

…Meanwhile, Congressional Republicans Are Passing Legislation To Weaken Protections For Millions of People with Pre-Existing Conditions and Boost Health Insurance Plans That Fail To Cover Key Prescriptions & Hospital Care. In June 2023, Republicans held a markup on multiple pieces of legislation promoting “junk plans” that can discriminate against people with pre-existing conditions and fail to cover essential services like hospital visits and prescription drugs in order to undermine the ACA. One of these bills would expand access to association health plans (AHPs), a type of junk plan that leaves behind sick and at-risk individuals and undermines the ACA. Another would promote the use of non-ACA-compliant plans and other self-funded benefit plans. Further, these types of plans exploit communities of color and other marginalized communities, making Black, Latino, Asian, Indigenous, and LGBTQI+ people in America – who are more likely to be living in poverty than their White, heterosexual counterparts – more likely to face higher premiums.

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