![]() ![]() ![]() An ACA-compliant plan, for example, must accept all applicants regardless of health status, limit the amount of cost-sharing imposed on an enrollee, and cannot set annual or lifetime dollar limits on key benefits. To make these assessments, the CBO must determine what it means to be “insured” in a world where insurance and insurance-like products come in a variety of shapes and sizes. The CBO frequently estimates how policy proposals will affect rates of health insurance coverage, which federal lawmakers may take into account when deciding whether or not to vote for a bill. How Does the CBO Define Health Insurance? We’ve looked at the CBO’s definition of health insurance before, but given a recent letter it sent to senators, where the agency doubled down on its assertion that STLDI constitutes insurance, it’s worth taking another look: Given what we know about STLDI, including its significant coverage gaps, such as exclusions for pre-existing conditions and prescription drugs the extraordinarily high out-of-pocket costs that STLDI enrollees have incurred after undergoing needed medical treatment for conditions such as a heart attack or pneumonia and evidence that the five largest issuers of STLDI in 2018 spent on average less than 40 percent of premiums on paying out claims how is it that the CBO considers those consumers enrolled in STLDI “insured”? The problem lies in the fact that CBO hasn’t updated its definition of health insurance to sufficiently reflect the post-ACA market and consumers’ expectations of what coverage should be. Such coverage, the CBO contends, falls under the agency’s definition of “health insurance.” Despite a history of STLDI serving only as a way to fill gaps in coverage, rather than providing comprehensive major medical insurance, the CBO predicted that most people covered by STLDI after the new regulations took affect would be enrolled in a plan that looks like typical individual coverage sold before the ACA’s major reforms went into effect in 2014. Recently, the nonpartisan Congressional Budget Office (CBO) determined that the majority of STLDI products sold under the new federal rules would be considered “health insurance” for the purposes of projecting the rate of coverage in the U.S. In 2018, the Trump administration finalized a rule expanding the availability of short-term, limited duration insurance (STLDI), which largely does not have to comply with the ACA’s consumer protections. Unfortunately, these products are sometimes grouped together under the moniker of “health insurance,” painting a rosier picture of the number of “insured” than what is actually the case. It is critical to understand the difference between these products and ACA-compliant plans not just for consumers, who are often the targets of deceptive marketing tactics, but for policymakers seeking to improve access to comprehensive and affordable coverage. ![]() ![]() Non-ACA-compliant products have been touted as a cheaper coverage option, but the lower sticker price is a result of these companies employing tactics that the ACA expressly forbids, including discriminating against sick people and failing to cover key health services. The ACA fundamentally transformed health insurance, based on the understanding that decent insurance coverage is not just an option for the young and healthy, but a fundamental right for all.īut alongside the ACA’s reforms, an unregulated market has sprung up, due in no small part to federal actions expanding alternative products and encouraging their sale. A plan sold on the individual market today has to provide more comprehensive protection against the increasingly high costs of health care than pre-ACA plans did. The ACA set the bar higher for health insurance coverage. Prior to the ACA, the individual health insurance market was a minefield for people with pre-existing conditions – in addition to coverage denials, insurers could charge higher rates, exclude coverage of important health services, and cap benefits, leaving consumers holding the bag if they went over the maximum threshold. The ACA is often touted for its coverage expansions, but the law was about coverage quality as much as it was about expanding the numbers of insured. On November 10, the Supreme Court heard a case challenging the Affordable Care Act (ACA), the landmark health law that led to a historically low uninsured rate in the U.S. ![]()
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