FACT CHECK: AHCA Eliminates Guaranteed Coverage for Preexisting Conditions

Experts

Director, Special Projects
Staff Attorney
Health Policy Analyst
Sr. Media Relations Associate

Monday, May 1, 2017

In an interview with Face the Nation that aired Sunday, President Trump asserted that protections for people with preexisting conditions were included in the American Health Care Act (AHCA). However, the most recent version of the AHCA  effectively eliminates guaranteed coverage for those with preexisting conditions, allowing states to waive community rating and return to allowing insurers to charge people based on their expected healthcare costs. One option for states choosing to waive community rating is the creation of high-risk pools, an element the President also noted is included in the bill.

Fact Sheet: Creation of High-Risk Pools Would Imperil the Most Vulnerable Consumers

But even if adopted by states, high-risk pools are not a substitute for preexisting conditions protections and, in fact, could leave millions of consumers uninsured. High-risk pools have a long track-record of failure and have historically resulted in very high premiums and onerous terms for the coverage that don’t provide the care consumers need. As estimates show that more than a quarter of all non-elderly consumers have pre-existing conditions that could cause difficulties in obtaining coverage, this option could have serious consequences for millions of Americans.

Consumers Union, the policy and mobilization arm of Consumer Reports, strongly opposes the AHCA because it is fundamentally bad for consumers. In addition to leaving millions uninsured, increasing consumer costs and rolling back protections for preexisting conditions, the current iteration of the AHCA would allow states to opt-out of Essential Health Benefits (EHB), including maternity care, mental health and substance abuse treatment. The elimination of EHBs triggers a “race to the bottom” as insurers drop coverage of expensive conditions, as was the case prior to the Affordable Care Act.

Fact Sheet: Essential Health Benefits Protect Consumers from Junk Insurance, Guarantee Crucial Coverage

Moreover, eliminating EHBs would allow insurance companies to reinstate annual and lifetime limits on plans. Currently, plans cannot limit care that is part of the EHBs on an annual or lifetime basis. Such limits would be devastating for consumers with serious illnesses, like cancer.

“The American Health Care Act is fundamentally flawed and no amendment can make it palatable for consumers. This proposal clearly allows states to do away with protections for preexisting conditions and essential health benefits, letting insurers charge our most vulnerable populations more,and also offering consumers plans that are basically junk and don’t provide meaningful coverage. Any other description is simply inaccurate,” said Betsy Imholz, Special Projects Director for Consumers Union.

For more information, visit www.ConsumersUnion.org/protect-our-healthcare.