Senators: Third-party sites pushing consumers into plans lacking coverage for preexisting conditions

U.S. Sens. Mark Warner (D-VA), Jeanne Shaheen (D-NH), and Tammy Baldwin (D-WI) sent a letter urging Health and Human Services (HHS) Secretary Alex Azar and Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma to do more to prevent third-party web brokers from steering individuals towards junk health insurance plans – short-term insurance plans that provide no protections for Americans with preexisting conditions.

On the HealthCare.gov website, CMS includes a link that directs customers towards third-party web broker sites for health care enrollment. The junk plans offered by many of these brokers are not Affordable Care Act (ACA)-compliant and do not have to offer the protections that the ACA mandates, including protections for people with preexisting conditions, such as cancer, diabetes and asthma, or coverage for essential health benefits, including maternity care, substance use disorder treatment and prescription medications. Web brokers have a significant financial incentive to enroll individuals in these deficient plans, and are often able to earn commissions up to four times higher than they would earn enrolling customers in ACA-compliant plans.

In their letter, the Senators highlighted the alarming consequences brought about by the lack of federal oversight of brokers in their letter.

“While federal rules prohibit brokers from displaying junk plans side-by-side with ACA-compliant qualified health plans (QHP), brokers can structure their webpages in ways that steer consumers toward higher-commission products, like junk plans,” wrote the Senators. “Equally concerning, web brokers’ online screening tools can fail to identify instances where a customer is eligible for Medicaid.  In other instances, the screening tools may identify potential Medicaid eligibility, but the web broker platform may continue to push a customer to purchase a junk plan.”

“An effective and well-functioning health insurance market is only possible if consumers are provided transparent information regarding the scope and cost of coverage available, the tax credits available to consumers to offset premiums for comprehensive health plans and the incentives that brokers have for selling various products. Availability of this transparent information is particularly critical in light of your agency’s decision to reduce funding for Health Insurance Marketplace advertising, outreach and education efforts by approximately 90 percent compared to 2016 levels. Your regulatory oversight in this area is vitally important to achieving this effective insurance market. We urge you to take this oversight responsibility seriously,” concluded the Senators.

Sen. Warner has continued to fight against the Trump Administration’s efforts to dismantle health coverage for the more than 3 million Virginians with preexisting conditions. Earlier this month, Sen. Warner urged the HHS and the Centers for Medicare & Medicaid Services (CMS) to limit the proliferation of junk plans. In July, Sen. Warner led the entire Democratic Caucus in a Congressional Review Act resolution to stop the Trump Administration from promoting junk plans. Last month, Sen. Warner filed a discharge petition that will force the Senate to vote on whether to protect Americans with preexisting conditions. The Senate is expected to vote on the resolution next week.