Sunday, September 23, 2018
Opinion

Column: Insurers must be required to continue covering pre-existing conditions

With all the chaos and confusion surrounding the Trump administration’s immigration and family separation policies, one can be forgiven for not noticing that other American values are also under siege.

Earlier this year, 20 Republican attorneys general, including Florida’s Pam Bondi, filed a lawsuit in Texas seeking (again) to repeal Obamacare. That should surprise no one.

But in a brief filed in the case earlier this month by the Department of Justice, the Trump administration announced it will not defend current prohibitions on pre-existing condition exclusions in health insurance. This new White House position is an astonishing and extremely troubling development.

Despite deep disagreements in America about health insurance, generally we have not retreated from finding ways to take care of our most vulnerable populations. Take the case of the elderly. In the 1950s, an overnight stay in a hospital cost roughly the same as a night in a modest hotel, and a visit to the doctor’s office cost about $30 in today’s prices.

Most Americans could afford these expenses out-of-pocket without serious financial hardship. But if you were a senior citizen, the story was different. Then and now, senior citizens consume a disproportionate share of health care because most elderly incur the vast majority of a lifetime of health care expenses in the last months of life.

The basic point is simple: As the end approaches, we usually get sicker, and this burst of medical care is expensive. Insurers have always understood this. When health care costs rose dramatically in the early 1960s, fewer than half of all elderly Americans could afford the increasingly expensive health insurance sold by commercial insurers. As a result, millions of elderly Americans went without medical care at the end of their lives or were bankrupted trying to obtain it.

America responded with a solution. It certainly helped that the elderly achieved something of a common voice in the electoral process and that Democrats swept the 1964 elections. Nonetheless, what ensued in 1965 was the enactment of Medicare, a federally managed health insurance program for the elderly (later extended to eligible disabled non-elderly citizens). It still stands today as one of the pillars of America’s commitment to take care of the most vulnerable among us.

Today, another vulnerable group exists — sick Americans who lack insurance, or who lose it, usually because they lose their jobs and their benefits. For about 50 million Americans under the age of 65, these illnesses are sufficiently serious — meaning things like cancer, diabetes, heart and pulmonary disease, kidney failure, Parkinson’s disease and so on — to result in outright rejection of an application for health insurance. For an additional 80 million Americans, other illnesses or conditions — such as arthritis, asthma, sleep apnea, pregnancy, and behavioral health conditions — would be excluded from coverage or insured only for a steep hike in the premium.

In unregulated private insurance markets, insurance companies want to exclude people with pre-existing conditions from those whom they agree to insure. This actually makes sense. We don’t let people insure their house for the first time after it has started burning, and we don’t allow someone who has run over a pedestrian to dash to an insurance agent and purchase liability insurance for the anticipated claim. If this were allowed, all of us would wait to buy insurance until our first loss has happened or is under way, and the business of insurance as we know it would collapse.

But access to medical care stands on a different footing in America, and for more than a half century we have rejected a premise that denies health insurance — which in today’s America is the ticket one needs for health care access — to the sickest among us. Thus, rather than leave tens of millions of vulnerable adults and children with pre-existing conditions on their own, America decided to protect them, as we did with the elderly. In 1996, Congress prohibited pre-existing condition exclusions in health insurance provided by employers to large groups, and the Affordable Care Act subsequently extended this prohibition to the individual and small-group markets. These laws protect tens of millions of vulnerable Americans, including millions for whom the lack of coverage would mean a choice between certain financial ruin and forgoing needed care.

This is why the White House position in the Texas lawsuit is so troubling. Instead of embracing the principle of helping those among us in need, we are given a glimpse of a Trumpian future where the vulnerable among us are told to fend for themselves in a world where insurance for pre-existing conditions is unavailable and health care is unaffordable without it. A retreat to this vision of health care in America should trouble us all. If this plan to cast aside those with pre-existing conditions succeeds today, will the next proposal be to "reform" Medicare and cast aside the elderly tomorrow?

Robert H. Jerry II, the Isidor Loeb Professor of Law at the University of Missouri and dean emeritus of the Levin College of Law at the University of Florida, teaches and writes in the field of insurance law.

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