Blue Cross of Idaho will soon begin selling a beefed-up version of a short-term health plan that the company promises will offer comprehensive benefits to thousands of middle-class Idahoans who can't afford Affordable Care Act plan premiums.
But because the plans still skirt some popular ACA consumer protections, critics say they're likely to benefit only healthy individuals at the expense of those who buy coverage through the exchanges.
The Blues insurer said the policies, dubbed "Access" plans, will be up to 40% cheaper than ACA-compliant coverage because Blue Cross will charge sicker, riskier individuals higher premiums and impose a 12-month waiting period for coverage for pre-existing conditions—two features outlawed by ACA plans.
While critics have slammed short-term policies for offering skimpy coverage, Blue Cross argued that the Access plans provide an attractive option to the 125,000 uninsured people in the state who don't qualify for federal subsidies and can't afford the high exchange premiums. It expects 35,000 people to enroll in the plans over the next three years, which will be available starting Jan. 1, 2020.
"We wanted to get something out there that people could actually afford and get back into having their families covered," said Peter Sorensen, the insurer's vice president of individual and government markets.
Blue Cross is offering the Access plans in response to the federal government's 2018 rule that extended the maximum duration of short-term policies and allowed them to be renewed.
Additionally, Idaho this year enacted legislation that would allow insurers to offer "enhanced" short-term plans that must be renewable and offer benefits consistent with the state's ACA benchmark plan. The plans are prohibited from charging different premiums based on whether a person is male or female, but they can charge more based on a person's health condition.
The legislative action came about a year after the CMS shot down an attempt to allow insurers to sell so-called "state-based plans" that didn't comply with the ACA; the agency at the time encouraged Idaho regulators to refashion the plans into short-term policies instead.
Sabrina Corlette, co-director of the Georgetown University Center on Health Insurance Reforms, said Idaho's enhanced short-term plans may make an affordable option for healthy people but wouldn't be a viable alternative for those with pre-existing conditions.
With maximum out-of-pocket limits of at least $15,000 for a single person and $30,000 for families under the most expensive plan, there isn't much financial protection if something bad were to happen, she said. By comparison, the out-of-pocket maximum for ACA marketplace plans in 2020 is $8,200 for individuals and $16,400 for families.
The lowest deductibles under the Access plans are $2,500 for single coverage and $5,000 for families, but can reach $10,000 for individuals and $20,000 for families under one of the three plan options.
"One of the biggest complaints about ACA plans is high deductibles, and so here we have a state that has been a strong opponent of the ACA and their alternative is a plan with a super-high deductible and that doesn't cover pre-existing conditions, and you get charged a higher premium if you have any sort of health issues at all," Corlette said. "States' time and energy would have been far better spent trying to do something like reinsurance and looking at ways to improve affordability for everybody."
Corlette also said that despite the fact that the enhanced short-term plans would be included in the same single risk pool as ACA plans in the state, the plans would not participate in risk adjustment and would raise the cost of ACA-compliant plans.
Sorensen, however, insisted the plans' benefits are comparable to or better than ACA coverage. Blue Cross' Access plans last 364 days and can be renewed for up to 36 months. But unlike most short-term health plans, they offer all 10 essential health benefits required under the ACA, including coverage for maternity care and prescription drug coverage, Sorensen said.
The three Access plans, which have varying deductibles and out-of-pocket maximums, cover preventive care before having to meet that deductible. Children can visit the family doctor and receive diagnostic tests without having to make a copay. Adults' first 10 visits to the primary-care doctor are covered prior to meeting the deductible, and there is no copay for the first six mental health visits.
The plans are, however, underwritten based on the health information provided on the plan application. While people with pre-existing health conditions, such as cancer, diabetes or even pregnancy cannot be denied coverage, their pre-existing conditions may be subject to a yearlong waiting period that may be shortened or eliminated in certain situations.
According to Blue Cross, a 39-year-old nonsmoking enrollee with no health conditions in Ada County, Idaho, would pay a monthly premium of as low as $207 under the cheapest Access plan. A 42-year-old with high blood pressure and one prescription drug would pay as low as $266.
Meanwhile, under an ACA exchange silver plan, average premiums for a 40-year-old in Idaho would total $520 per month, according to the Kaiser Family Foundation.
Blue Cross of Idaho will also continue to sell traditional short-term limited-duration plans and ACA exchange plans.
