In a Friday announcement, the U.S. Department of Health and Human Services said it plans to crack down on “junk health plans” and more.
This crackdown is part of a “Bidenomics” agenda effort to lower health care costs in the country. To do so, the HHS intends to take actions to protect consumers from surprise medical bills and excess costs that build medical debt in addition to addressing junk insurance.
According to the Leukemia and Lymphoma Society, junk health plans are “short-term, limited-duration plans,” that “leave patients on the hook for thousands of dollars if they face serious health problems – much more than they’d face if they had traditional health insurance.”
These plans often have misleading marketing, the society added. A White House fact sheet said that President Joe Biden’s administration’s new proposed rules are intended to close loopholes that allow companies to offer misleading products. It also said former President Donald Trump’s administration “took advantage” of those loopholes.
“Junk plans drive up more than a patient’s out-of-pocket costs – they threaten prices across the health insurance market,” the Leukemia and Lymphoma Society explained. “As younger and healthier individuals choose these cheaper ‘junk plans’ over comprehensive insurance, premiums for comprehensive insurance are expected to rise.”
A report released Friday by the HHS found that a projected 19 million seniors are already expected to save approximately $400 per year on prescription drug costs when a $2,000 out-of-pocket prescription drug spending cap goes into effect in 2025. This cap was included in the Inflation Reduction Act. Recently, the administration also worked to cap insulin prices.
“Today’s announcement protects patients from junk health insurance and unfair billing practices, and increases transparency in our health care system, while continuing to implement President Biden’s historic prescription drug law that is lowering costs for millions of seniors across the country,” said HHS Secretary Xavier Becerra.
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