Shaheen, Hassan Join Group of Senators Urging Biden Administration to Limit Availability of Junk Health Care Plans

WASHINGTON, Feb. 24 -- Sen. Maggie Hassan, D-New Hampshire, issued the following news release on Feb. 23, 2023, and letter:

U.S. Senators Jeanne Shaheen (D-NH) and Maggie Hassan (D-NH) joined a group of 32 Senators in a letter urging the Department of Health and Human Services (HHS) to take immediate action and address short-term limited duration insurance (STLDI) plans, or junk plans, which fail to provide adequate, comprehensive health insurance coverage.

Junk plans can deny coverage to people with pre-existing conditions and don't have to cover essential services like maternity care, prescription drugs, substance use disorder treatment and emergency room care.

In 2018, in an effort to sabotage the Affordable Care Act (ACA), the Trump administration made junk plans more widely available to consumers. Since then, these plans have continued to expand, however, they are not required to adhere to important standards, including prohibitions on discrimination against people with pre-existing conditions, coverage for the 10 essential health benefit (EHB) categories and annual out-of-pocket maximums. .

"Now, more than ever, the Department of Health and Human Services must act. Beginning in April, millions of Americans will likely lose the Medicaid coverage that they have relied upon during the COVID-19 pandemic. We must protect those who will be looking for coverage in the near future and take steps to ensure that these plans are not allowed to further proliferate," wrote the Senators. "It is past time for your Department to step up and address the expansion and proliferation of junk plans."

The letter was led by Senators Tammy Baldwin (D-WI) and Chris Murphy (D-CT). The letter was also signed by Senators Richard Blumenthal (D-CT), Cory Booker (D-NJ), Sherrod Brown (D-OH), Ben Cardin (D-MD), Bob Casey (D-PA), Christopher Coons (D-DE), Catherine Cortez Masto (D-NV), Tammy Duckworth (D-IL), Richard Durbin (D-IL), Dianne Feinstein (D-CA), Martin Heinrich (D-NM), John Hickenlooper (D-CO), Timothy Kaine (D-VA), Angus King (I-ME), Amy Klobuchar (D-MN), Ben Ray Lujan (D-NM), Edward Markey (D-MA), Robert Menendez (D-NJ), Jeff Merkley (D-OR), Patty Murray (D-WA), Alex Padilla (D-CA), Gary Peters (D-MI), Jack Reed (D-RI), Tina Smith (D-MN), Debbie Stabenow (D-MI), Chris Van Hollen (D-MD), Mark Warner (D-VA), Raphael Warnock (D-GA), Elizabeth Warren (D-MA) and Peter Welch (D-VT).

Shaheen has consistently pushed for efforts to limit the sale and availability of short-term, limited-duration insurance (STLDI) plans, also known as junk plans. Senators Shaheen, Baldwin and Warner previously called on the last administration to do more to prevent third-party web brokers from steering individuals toward junk health insurance plans that do not provide coverage of pre-existing conditions or essential health benefits. In addition, Shaheen has led efforts in Congress to protect and improve the ACA. During the COVID-19 public health emergency, Shaheen spearheaded Senate Democrats' proposal to make health care affordable and accessible for Americans. More recently, Shaheen led efforts to lower premiums to make health insurance more affordable for patients through her signature legislation, the Improving Health Insurance Affordability Act. Portions of Shaheen's bill that provide temporary premium tax credits were included in the American Rescue Plan Act (ARPA) and the Inflation Reduction Act (IRA). Shaheen's standalone bill would make permanent enhanced tax credits that led to the record 2023 Marketplace enrollment, while reducing health care costs for tens of thousands of Granite Staters and millions of additional Americans.

As a member of the Senate Health, Education, Labor, and Pensions Committee, Senator Hassan has led efforts to expand access to affordable health insurance and lower health care costs. During the previous administration, Senator Hassan fought back against its attempts to undermine the Affordable Care Act and push "junk" insurance plans that weaken pre-existing condition protections. Senator Hassan also led successful bipartisan efforts to help eliminate surprise medical billing, which has prevented at least 9 million surprise bills. Additionally, the Inflation Reduction Act included a number of key provisions that Senator Hassan pushed for to take on Big Pharma and address the skyrocketing cost of prescription drugs, including allowing Medicare to negotiate prescription drug prices - which will bring down the cost of prescription drugs for Medicare beneficiaries and help drive down prices across the board - and capping out-of-pocket expenses for Medicare prescription drugs. Senator Hassan is also working across the aisle to make cheaper generic drugs more available, including securing three bipartisan measures in the year-end funding bill, which is now law, to increase access to generic and biosimilar medications.

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To: The Honorable Xavier Becerra, Secretary, Department of Health and Human Services, 200 Independence Ave SW, Washington, DC 20201

Dear Secretary Becerra,

As we celebrate the State of the Union and the important gains that we have made when it comes to expanding the availability of comprehensive, affordable health care coverage, we write once again to urge you to take immediate action and address short-term limited duration insurance plans, or, junk plans. Now, more than ever, the Department of Health and Human Services must act. Beginning in April, millions of Americans will likely lose the Medicaid coverage that they have relied upon during the COVID-19 pandemic. We must protect those who will be looking for coverage in the near future, and take steps to ensure that these plans are not allowed to further proliferate.

The Families First Coronavirus Response Act (Families First) (P.L. 116-127) provided additional federal Medicaid funding to states during the COVID-19 public health emergency in exchange for maintaining coverage, specifically by meeting certain maintenance-of-effort requirements. These requirements barred states from lowering income eligibility levels, imposing new premiums or other barriers to enrollment, and involuntarily disenrolling individuals from their programs. According to federal data, Medicaid enrollment has increased by over 30 percent since February of 2020, an additional 19.5 million people./1

Congress has also worked to provide additional financial support for those who purchase ACA marketplace plans, and in August, passed the Inflation Reduction Act, which extended the additional financial support first enacted as part of the American Rescue Plan. As a result of this additional support, consumers saved an average of $800 on their premiums in 2021,/2 and will continue to see savings through 2025.

As part of the Fiscal Year 2023 (FY23) omnibus, Congress took steps to uncouple the maintenance-of-effort requirements included in Families First from the public health emergency in order to avert both a Medicaid coverage and funding cliff. Starting on April 1, 2023, states will be able to begin conducting Medicaid eligibility redeterminations and enhanced federal funding will gradually phase out from April through December 2023. In order to receive enhanced funding during this period, states must follow all federal requirements related to redeterminations, update beneficiaries' contact information, and use multiple methods to contact individuals when they have moved and have an out-of-date mailing address. States will also be required to submit monthly reports on unwinding, including information indicating where beneficiaries are experiencing challenges.

Congress worked to make sure that the FY23 omnibus gave state Medicaid programs a roadmap for the months ahead and enacted the Inflation Reduction Act to provide additional financial support for those enrolling in health coverage through the marketplace. It is now time for the Administration to do its job and act to protect those who will be seeking to enroll in coverage in the coming months.

According to estimates from your Department, approximately 15 million individuals will lose Medicaid or CHIP coverage in the coming year and will therefore require affordable health care coverage./3 Millions will be eligible for significant financial assistance to purchase comprehensive coverage on the marketplace. But without additional protections, many Americans could find themselves enrolled in junk plans that do not provide comprehensive coverage or protection for individuals with pre-existing conditions. These plans, which were actively promoted by the previous Administration and remain unchecked, are not required to comply with consumer protections that limit out-of-pocket costs or coverage of essential health benefits, including mental health services, treatment for substance-use disorder, prescription drug benefits, and maternity care. Furthermore, these plans engage in the type of discriminatory practices, such as retroactive coverage rescissions, medical underwriting, and lifetime and annual caps, which were commonplace before the Affordable Care Act.

Since President Biden took office, he has prioritized expanding access to comprehensive, affordable health coverage. Congress has supported these efforts. It is past time for your Department to step up and address the expansion and proliferation of junk plans.

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View footnotes and co-signers here: https://www.baldwin.senate.gov/imo/media/doc/022223lettertohhsonjunkplans.pdf

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Original text here: https://www.hassan.senate.gov/news/press-releases/shaheen-hassan-join-group-of-senators-urging-biden-administration-to-limit-availability-of-junk-health-care-plans