Today, the Trump Administration released a final rule allowing consumers to purchase cheaper health insurance starting in October 2018. Short-term health plans, as these policies are known, need not cover the “essential benefits” that the Affordable Care Act requires for insurance policies sold on the Exchange. For that reason and others, short-term policies are far less expensive than traditional comprehensive health insurance. With the new rule issued by the Departments of Health and Human Services, Treasury, and Labor on August 1, 2018, consumers can purchase short-term plans that last for up to one year, with the option to renew their plan for up to three years.
This change is one of many steps taken in recent months to reduce the cost of healthcare by increasing competition and consumer power. In response to the rule, James Bowers, managing director at the Center for Consumer Freedom, issued the following statement:
“Permitting short-term, limited duration health coverage to extend up to 36 months is the right move for consumers. Greater plan diversity and competitive monthly premiums allow consumers the freedom to choose a plan that fits their needs. Pundits should not be so willing to dismiss the financial relief that short-term plans bring to low-income consumers who struggle to afford even the least expensive plan on a state.
Those who remain troubled by the specter of broad premium increases across the Federal Marketplace must reconcile their ideals with this reality: Do we truly expect those Americans who are least able to afford healthcare to subsidize maternity coverage for a family who can afford a Gold or Platinum plan on the Federal Marketplace? Our answer is no.”