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U.S. House Committee Exercises Oversight of “Skinny” Health Plans

March 15, 2019

The U.S. House Energy & Commerce Committee initiated an oversight investigation into the practices of short-term, limited duration insurance (STLDI) health care plans and insurance brokers. The investigation arose out of concern that consumers are being misled about the coverage they are securing, and the expanded use of these narrower insurance products runs contrary to goals and protections ensured by the Affordable Care Act (ACA).

During August 2018, the Trump Administration finalized federal policy that significantly extends from three months to up to three years the amount of time individuals may remain enrolled in short-term health insurance plans. The stated intent of the policy is to expand access to less expensive alternative insurance options; however, these plans are not subject to the full patient protections and benefits assured under the ACA, including guaranteed coverage for pre-existing conditions and minimum essential health benefits.

Traditionally, STLDI plans have been used by consumers who are experiencing a temporary gap in their health insurance coverage. The short-term plans generally limit the types of services covered, include maximum dollar coverage amounts, and exclude certain pre-existing conditions.

The Trump Administration has promoted alternative insurance options, like STLDI, asserting that less comprehensive products will increase competition and bring down costs for consumers. Many patient advocates have raised concerns that consumers may not understand the scope of the coverage they are securing. Additionally, advocates are concerned that healthier consumers will take advantage of less-costly, less-generous coverage, leaving the sicker and higher-cost patients to secure coverage through ACA plans—ultimately undermining the ACA insurance marketplaces.

Leaders of the Energy & Commerce Committee sent letters to 12 companies that sell STLDI plans or serve as brokers. The committee expressed concerns about reports that STLDI plans are denying coverage entirely; charging more based on age, gender, or health status; or refusing to cover consumers for care that may stem from a pre-existing condition.

The committee also cited recent reports that indicate that STLDI plans are engaging in marketing tactics that may mislead consumers about the scope of the coverage they are securing.

HAP’s guideposts in reviewing health care reform policy has been preserving Pennsylvanians’ ability to access and secure comprehensive, reliable health care coverage. Thanks to the ACA, more than 1.1 million Pennsylvanians have benefitted from coverage through the marketplace, Medicaid expansion, and dependent coverage.

HAP continues to advocate in support of the ability of Pennsylvanians, particularly those with underlying health conditions, to afford health insurance, and to maintain the stability of the commonwealth’s health insurance marketplace. 

Please contact Jolene Calla, HAP’s vice president of health care finance and insurance, or Laura Stevens Kent, HAP’s vice president of federal advocacy, with questions.

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