Washington, DC – Today, Senators Tammy Baldwin (D-WI) and Doug Jones (D-AL) introduced the “No Junk Plans Act,” a bill that reverses the Trump administration’s expansion of junk insurance plans that do not protect patients with pre-existing conditions. This legislation, cosponsored by the entire Senate Democratic caucus, is a companion to H.R. 987, the bill that passed overwhelmingly by the House of Representatives last week. Brad Woodhouse, executive director of Protect Our Care, praised the legislation in a statement:
“First the House, now the Senate under the leadership of Senators Baldwin and Jones is taking much needed action to end the Trump administration’s push to expand junk insurance plans that discriminate against Americans with a pre-existing condition. Junk insurance plans supported by Trump and Congressional Republicans are disastrous for the millions of Americans with pre-existing conditions — especially those who have bought these plans without knowing that they can exclude coverage for essential services like maternity care, prescription drugs, and cancer treatment. If Republicans truly cared about protecting Americans with pre-existing conditions, they would support this bill instead of blindly following Trump in his ongoing war on America’s health care.”
BACKGROUND:
Already, junk plans are devastating consumers who get sick:
Stephanie Sena Contracted Sepsis And Needed Amputation — Her Junk Insurance Wouldn’t Pay. “Stephanie Sena was about to have half her foot amputated, an urgent procedure to keep a blood infection from spreading to the rest of her body. But the surgeon required payment up front and the insurance plan that the 39-year-old Villanova University adjunct professor bought months earlier was refusing to pay. She had less than 24 hours to come up with $1,920. Sena’s insurance plan, it turned out, was not real health insurance. It was an accident and sickness hospital indemnity plan that paid a set dollar amount for certain services. This surgery was not on the list. She has since gotten a $1,725 refund for seven months of premiums, after The Inquirer contacted the company, but that will barely put a dent in the $19,000 medical debt she’s accumulated since enrolling in a plan that covers virtually nothing.” [Philadelphia Inquirer, 4/5/19]
Short Term Plans Deceive Consumers Like Milton Rodriguez, Who Learn Their Plans Don’t Cover Emergency Room Services After Going To The Hospital For Emergency Room Services. “If there was ever a time Rodriguez needed health insurance, this was that time. He called an insurance broker who had reached out to him when he was shopping around for a plan. ‘I called at night and just needed something that would cover me right away,’ Rodriguez said.The broker sent a policy, which Rodriguez approved. He then sent a payment to the insurance company. The broker told him he’d be covered starting at 12 a.m. As soon coverage kicked in, Rodriguez went to the closest hospital, St. David’s in South Austin. It turned out he had appendicitis. While he was waiting for a bed in the ER, hospital staff took his insurance information. He had surgery and was sent home to recover. Rodriguez started getting phone calls from doctors and the hospital asking about his insurance plan. ‘And then the next thing I know is, I get my bills in the mail and it seems like the most important part – which was the emergency room, everything that happened within the emergency room – none of that was covered,’ he said. His bill: $62,620. At the bottom of that bill, there was a code explaining why coverage wasn’t applied: ‘This policy does not provide benefits for services provided in the emergency room.’” [KUT, 10/31/18]\
Consumers are often sold these plans intentionally and misleadingly:
Georgetown University Health Policy Institute Finds Consumers Searching Online For ACA Compliant Plans Are Often Directed, Instead, To Junk Plans. “Our marketing scan suggests that consumers shopping online for health insurance, including those using search terms such as ‘Obamacare plans’ or ‘ACA enroll,’ will most often be directed to websites and brokers selling STLDI or other non–ACA compliant products. These websites and brokers often fail to provide consumers with the plan information necessary to inform their purchase. Brokers selling STLDI over the phone push consumers to purchase the insurance quickly, without providing written information…Even during ACA open enrollment, only 19 percent of searches using the previously delineated terms returned sites offering solely ACA-compliant plans. Before open enrollment, the return was less than 1 percent. Generally, regardless of the search terms used, companies selling short-term plans dominated the returns. However, short-term plan insurers’ and brokers’ sites appeared more frequently when we searched for ‘short-term health insurance.’” [Georgetown University Health Policy Institute, 1/31/19]
New York Times: Federal Officials Shut Down Sales Of ‘Ruinous’ Health Insurance Plans. “‘There is good cause to believe’ that the Florida companies have sold shoddy coverage by falsely claiming that such policies were comprehensive health insurance or qualified health plans under the Affordable Care Act, Judge Darrin P. Gayles of the Federal District Court in Miami said in a temporary restraining order issued last week at the request of the Federal Trade Commission…The trade commission said the financial consequences of the misrepresentations ‘have been ruinous for consumers, many of whom do not realize’ the limits of the coverage until they incur substantial medical expenses. The commission described Mr. Dorfman as ‘the architect of this scam’ and said he had ‘siphoned millions of dollars of proceeds from defrauded consumers to pay for private jet travel, gambling sprees in Las Vegas, the rent for his oceanfront condominium, luxury automobiles, over $1 million in jewelry, and even the nearly $300,000 cost of his recent wedding at the St. Regis Hotel in Miami.’” [New York Times, 11/5/18]
The Federal Trade Commission Condemned One Company’s Junk Plan Scheme As “Classic Bait-and-Switch Scheme Designed To Trick Consumers.” “The members of the trade commission — three Republicans and two Democrats — voted unanimously to take action against the Florida operation, which the commission described as ‘a classic bait-and-switch scheme designed to trick consumers into paying hundreds of dollars for substandard products under the pretense that they are actually receiving comprehensive health insurance.’” [New York Times, 11/5/18]
For a deeper look at the history of junk plans and scam, take a look at our fact sheet: “Junk Plans Ripe For Fraud, Dangerous For Consumers.”