On August 2, the Trump administration issued a proposed rule allowing the sale of short-term, limited-duration health insurance plans, also known as short-term plans. The new rule extends the renewal period for short-term plans up to a year, a change from the previous Obama-era policy of letting them last only up to three months. It also allows these plans to be extended for up to 36 months.
The longer renewal period will give Americans more options to determine the length of their healthcare policies, at least until they can find a longer-term plan that better suits their needs. This is yet another step in the Trump administration’s plan to undermine rigid Obamacare rules so that working families have better health insurance choices available.
This should be great news, given that 28 million Americans are currently without health insurance, according to the Centers for Disease Control and Prevention, and that most of those people don’t have health insurance because they can’t afford it. One would expect almost universal support for a rule change allowing more healthcare freedom. After all, the plans are already available under Obamacare as a less-expensive option meant to help people who have found themselves between jobs, and insurers and consumers are familiar with short-term plan coverage; the new rule simply increases how long people may remain enrolled in these plans.
Furthermore, these plans are tailor-made for people who earn just enough money (for a single individual, $47,000 per year) to fail to qualify for Obamacare subsidies. This is especially pertinent because Obamacare premiums have risen 105 percent since its inception four years ago—from $232 per person per month to $476 per person, according to The Heritage Foundation.
The new rule allows individuals to carry these plans a bit longer, providing a much-needed option as healthcare consumers seek alternatives to expensive, one-size-fits-all Obamacare plans. Indeed, President Trump has been fighting for increased healthcare choices ever since he signed the “Promoting Healthcare Choice and Competition Across the United States” executive order.
Unfortunately, many so-called patient advocacy groups—such as the American Lung Association, American Heart Association, and National Multiple Sclerosis Society—do not support the new rule. They and other critics claim that the new short-term plans are too “skinny” because they don’t include Obamacare’s “essential health mandates.” For example, many do not cover maternity care, prescription drugs, or substance abuse treatments.
What these opposition groups fail to explain is that these plans are not intended to be comprehensive insurance plans, and that not all Americans want or need comprehensive healthcare coverage.
Although “skinny plans” don’t include many of Obamacare’s essential health benefits, the good news is these less-comprehensive plans are much more affordable. On average, they cost $160 per month or less, which is notable when compared to a standard Obamacare Silver Plan, which typically costs $481 per month for a 40-year-old nonsmoker.
Furthermore, thanks in large part to the Trump administration’s new rule, the healthcare industry is developing “next generation” short-term insurance plans, according to a report from the Associated Press. Insurance insiders say these plans will better meet the unique needs of health insurance consumers who are frustrated with industry and political infighting.
According to the nonpartisan Congressional Budget Office, during the next five years, roughly six million more people are expected to enroll in either an association health plan or a short-term health insurance plan, with about 1.6 million expected to choose the latter.
Instead of attacking the Trump administration for political and financial reasons, true patient advocates should instead praise the additional choice that’s finally being provided to these millions of Americans.
[Originally Published at the Washington Examiner]