Trump administration releases final rule for short-term health plans: 5 things to know

HHS issued a final rule on short-term health plans Aug. 1.

Here are five things to know about the rule:

1. Americans will soon be able to buy short-term health plans that offer coverage for a longer period of time than previously allowed. Coverage can now span less than a year, and extensions and renewals can last as long as three years, depending on what states decide. Before, short-term plans could not last longer than three months.

2. HHS said the rule will help increase health insurance choices for Americans who face increasing premiums and fewer plan options in the ACA individual market. HHS Secretary Alex Azar said: "President [Donald] Trump is bringing more affordable insurance options back to the market, including through allowing the renewal of short-term plans. These plans aren't for everyone, but they can provide a much more affordable option for millions of the forgotten men and women left out by the current system."

3. Short-term health insurance plans are not required to comply with consumer protections established by the ACA, such as the requirement to cover essential health benefits and pre-existing conditions. While that allows the plans to have lower price tag — the average monthly premium for short-term health plans was $124 in 2016, compared to $393 for unsubsidized individual market plans — the coverage is less extensive.

4. Insurers issued varying reactions to the rule. Matt Eyles, president and CEO of America's Health Insurance Plans, said in a prepared statement, "We remain concerned that consumers who rely on short-term plans for an extended time period will face high medical bills when they need care that isn't covered or exceed their coverage limits."

Association for Community Affiliated Plans CEO Margaret A. Murray said in a prepared statement: "Fake insurance is no substitute for real coverage. ACAP has long opposed this … proposal as an arbitrary and capricious effort to do a regulatory end-run around the patient protections in the Affordable Care Act. Countless Americans will be hurt by this new regulation, from patients to providers."

5. The rule will take effect 60 days after its publication in the Federal Register.

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