Short-term health insurance is a high-risk gamble for consumers

Riding an all-terrain vehicle and cruising through winter on a snowmobile are classic ways to enjoy the Minnesota outdoors. But sadly, accidents do happen. Now imagine that heartache compounded by a financial nightmare: finding out that the fine print in a loved one's health insurance plan excludes their injuries from coverage simply because of the activity he or she was engaged in.

This troubling scenario ought to be in the forefront of consumers' minds as the Trump administration and Minnesota Republican legislators push a dubious health reform — allowing short-term limited duration health plans, which exclude a surprising number of medical care needs, to provide coverage for up to a year instead of a matter of months.

These plans currently exist and are marketed to those who are waiting for a new job's health insurance to kick in, for example, or because they missed the open-enrollment window to buy traditional insurance. Extending the time period could entice more people to rely on these plans because the coverage wouldn't expire so quickly.

Trump's Department of Health and Human Services (HHS) has proposed extending the coverage period to roughly a year from about three months. HHS Secretary Alex Azar is touting this as a way to provide a more-affordable health insurance option. A coverage period extension is also included in the Minnesota House's sprawling health and human services bill. Meanwhile, Maryland has acted responsibly to tighten coverage periods due to these plans' risks.

The numbers that Azar wields to gin up support for short-term plan extensions paint a deceptively positive picture. His department estimates that an individual short-term plan would cost $124 a month, compared with $393 for an unsubsidized plan that meets Affordable Care Act coverage requirements. The savings might dazzle consumers, but "Buyer beware!" ought to be shouted from the rooftops.

One important point is that the savings might not be so great. Note the word "unsubsidized." Financial subsidies are available through the ACA to instantly discount monthly premiums for plans sold on MNsure and other marketplaces. Many consumers may still be unaware that they're financially eligible for this assistance.

But the main caveats are these: Many consumers wouldn't be approved for such a plan because they have a pre-existing condition. In addition, a short-term plan may not cover many of the needs a consumer might expect insurance to handle.

The scenario involving noncoverage of snowmobile or ATV injuries isn't theoretical. A short-term plan advertised by a Minnesota-based insurer right now excludes these, along with maternity care, mental health treatment, substance abuse treatment or injuries sustained while "participating in interscholastic, intercollegiate or organized competitive sports." Many short-term plans also won't cover pre-existing conditions even for those consumers who are approved to enroll.

Consumers should also look closely at hospitalization coverage for care that is covered. Cheaper short-term plans may only contribute $1,000 a day toward inpatient stays and provide $100 toward one inpatient physician visit. To put that in perspective, hospital charges for an uncomplicated appendectomy at Minnesota hospitals clock in at $24,550 on average, with a stay of 2.4 days, according to the Minnesota Hospital Association's "Hospital Price Check" tool.

There are those who will argue that these plans are no different than high-deductible plans that are sold through MNsure right now. That's not accurate. Those plans, which meet ACA requirements, provide broad coverage and protections for those with pre-existing conditions. The deductible may be high, but once that threshold is met, coverage is robust and there should be no surprises in the fine print.

Short-term plans are cheap because they don't cover very much. Policymakers pushing these plans ought to be asked if they'd be comfortable relying on them for their families. The only responsible answer is "no."