The Trump Administration just released the final ruling on what a Short Term Plan is going to look like for 2019, and since the Individual Mandate is now gone, these plans may become very popular. Years ago, these plans were used as “bridges” for people that lost coverage, or were in a waiting period of a new job, they were never meant for people to use them as their long term solution to healthcare. There are some drawbacks to Short Term Health Plans that people need to be aware of.
Short Term Plans have limitations in length of coverage and what is exactly covered
Previously, Short Term Plans have had a maximum time period of about 3 months. With the new ruling, the maximum length will be one year, with the possibility of extending that up to 3 years. Short Term Plans or STPs, have coverage limitations as well and do not cover many of the services that the ACA plans have now, worrying some critics that people will flood to these plans, leaving the ObamaCare, ACA plans for the sick and needy people. The cost of the STPs are forecasted to be as much as 80% cheaper than an ACA compliant ObamaCare plan.
STPs will be regulated state by state
The Short Term Plans will be regulated by the individual states and can be more restrictive than federal regulations. Each insurance commissioner will be responsible for overseeing and monitoring the STPs in their state. This oversight was a key component with NAHU, the organization of Health Underwriters, that our agency belongs to. They were instrumental in the structuring and helping various entities when the STPs were being constructed. This is still a work in progress, but according to many sources, its just a matter of some fine tuning, and when these will actually be available for consumers.