Politics, Moderate



Trump's Obamacare order could destroy the health-care system

Catherine Rampell on

What about those "short-term health plans"?

These can sometimes serve a legitimate purpose -- a stopgap to tide you over for the summer until the school year starts, for instance.

But after Obamacare passed, there was a proliferation of scammy "short-term" plans that weren't so short term. Some lasted 364 days! Why?

"They walked and talked like traditional insurance, but as long as they were less than 12 months, they were not technically considered 'insurance,'" explains Sabrina Corlette, a research professor at Georgetown University's Health Policy Institute.

As such, the plans weren't subject to Obamacare consumer protections such as essential health benefits and guaranteed issue to people with pre-existing conditions. Insurers could offer skimpy plans and cherry-pick the cheapest, most profitable enrollees.

The Obama administration ultimately closed this loophole by determining that short-term plans must be shorter than three months.

With his executive order, Trump seeks to re-lengthen those plans.

Both of these changes, the president boasts, would give consumers more "choice." Which sounds swell. But insurance markets do weird, counterintuitive things when you introduce more choice.

Two main problems result.

One is that, absent minimums for quality and regulatory oversight, lots of Americans are likely to get conned into plans that cover almost nothing. These are sometimes called min-med or "buffalo plans," because they pay out pretty much only if you're trampled by a herd of buffalo.


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