Administration proposes limit on short-term, limited-duration insurance

Jul 07, 2023 - 03:02 PM
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The Administration released a proposed rule intended to limit the sale of non-comprehensive health care coverage and promote greater consumer understanding of their coverage options.  
  
Specifically, the rule would restrict the length of short-term, limited-duration insurance, which was extended during the previous Administration. If finalized, the initial contract period for STLDIs would be capped at three months, with a maximum coverage period of four months, taking into account renewals and extensions. Currently, initial contracts for STLDIs can last up to 12 months, with renewals and extensions extending the coverage to a maximum duration of up to 36 months. The rule also would prohibit the sale of 1) fixed indemnity excepted benefits coverage that mirrors comprehensive health plans without needing to offer the same consumer protections and amend the consumer notice requirements for STLDI, and 2) fixed indemnity excepted benefits coverage to ensure consumers understand the clear differences between these types of plans and comprehensive coverage as well as their options for purchasing comprehensive coverage. Finally, the rule includes requests for comments on specified disease excepted benefits coverage and level-funded plans.  
  
In a statement shared with the media today, AHA Executive Vice President Stacey Hughes said, “Everyone should have access to affordable, comprehensive health care coverage that allows them to receive the care they need, when they need it. The AHA is pleased with the Administration’s proposal to protect consumers from skinny ‘health plans’ that often fail them. Short-term, limited-duration health plans often cover fewer benefits and provide fewer protections, like ensuring coverage of pre-existing conditions. This rule, if finalized, will go a long way in protecting patients from unexpected coverage denials. We look forward to commenting on this proposed rule with our ideas to achieve this important goal.” 
  
Comments on the proposed rule are due by Sept. 11.  

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