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New Report: Patients Pay the Price with Proliferation of Substandard Health Plans

A new report published by 30 patient organizations shows the risks patients face when they enroll in non-compliant and substandard health insurance.

WASHINGTON, D.C., March 25, 2021 – A new report published by 30 patient organizations shows the significant risks patients face when they enroll in non-compliant and substandard health insurance products, and details ways state and federal lawmakers can help protect these vulnerable consumers.

The report, “Under-Covered: How ‘Insurance-Like’ Products Are Leaving Patients Exposed,” issued by a coalition representing millions of people with pre-existing conditions, details eight different types of “non-compliant plans” that do not adhere to Affordable Care Act (ACA) consumer protections like coverage for pre-existing conditions, elimination of annual and lifetime coverage limits, and coverage for essential health benefits. 

The plans have proliferated in recent years, and in many cases, are marketed to consumers who don’t fully understand what they’re purchasing. As a result, patients are often vulnerable to exorbitant medical bills. This report serves as a warning to consumers to avoid these plans – and a call to action to lawmakers.

“Allowing these plans to remain on the market effectively turns back the clock to the days when insurers could reject people with pre-existing conditions, exclude coverage for specific diseases and hike premiums based on an individual’s medical history, gender or age without limits,” the coalition of 30 patient groups said.

The new report outlines the details of eight different types of “non-compliant plans,” chronicling the stories of six patients who struggled with their health and finances after their substandard health coverage refused to pay for their treatment. In addition to leaving patients without adequate coverage, the products also increase costs for individuals and families who rely on ACA-compliant, comprehensive coverage by siphoning younger and healthier people away from the regulated insurance market. 

The new report details the specific harms of many types of non-compliant health plans and urges state and federal policymakers to take immediate steps to protect patients by limiting their expansion. The report also provides specific recommendations that policymakers should move quickly to implement to protect consumers.

“We’re calling on Congress, the Biden Administration, and state policymakers to take immediate steps to mitigate the harm of these substandard products,” the patient organizations said. “Patients need and deserve better, and once again, must be ensured access to comprehensive, affordable coverage.”

Read the full report at lls.org/undercovered.

The following organizations published the report:

The AIDS Institute
The Alpha-1 Foundation 
ALS Association 
American Cancer Society Cancer Action Network
American Diabetes Association
American Heart Association
American Kidney Fund
American Liver Foundation
American Lung Association
Arthritis Foundation
Asthma and Allergy Foundation of America
Cancer Support Community
Chronic Disease Coalition
Cystic Fibrosis Foundation 
Epilepsy Foundation
Hemophilia Federation of America
JDRF
The Leukemia & Lymphoma Society
Mended Hearts & Mended Little Hearts
Muscular Dystrophy Association 
National Alliance on Mental Illness
National Hemophilia Foundation 
National Kidney Foundation
National Multiple Sclerosis Society
National Organization for Rare Disorders
National Patient Advocate Foundation
Pulmonary Hypertension Association
Susan G. Komen
United Way Worldwide
WomenHeart: The National Coalition for Women with Heart Disease