April 19, 2024

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HHS overturns Trump’s extended short-term plan coverage

2 min read

Photo: Westend61/Getty Images

The Department of Health and Human Services, joined by other departments, is cracking down on what they call junk insurance plans, in a final rule released today.

The Departments of Health and Human Services, Labor and the Treasury have released the Short-Term, Limited-Duration Insurance and Independent, Noncoordinated Excepted Benefits Coverage, or “Junk Insurance,” Final Rule.

The rule limits short-term plans to no more than four months, instead of the current three years set under the Trump administration in 2018.


Short-term, limited-duration insurance is health insurance designed to fill temporary gaps in coverage when an individual is transitioning from one source of coverage to another. 

Unlike most health insurance plans, short-term plans are not subject to the Affordable Care Act’s consumer protections, including guaranteeing coverage for people with preexisting conditions. 

The rule closes loopholes to prevent health insurers from misleading consumers into buying health plans that discriminate based on preexisting conditions and that provide little or no coverage when consumers need it the most, CMS said. 

“Today’s action will protect families from receiving thousands of dollars in healthcare bills,” the agency said.


The final rules require health insurers to be clear and upfront with what consumers are buying. Short-term plans, as well as “fixed indemnity” insurance policies that provide a fixed cash payment for a healthcare event, will have to include a clear, easy-to-understand consumer notice on marketing, application, enrollment and reenrollment materials.

The final rules increase transparency while helping to ensure that consumers do not mistakenly enroll in these types of insurance plans as substitutes for comprehensive coverage, CMS said.


“HHS is cracking down on junk insurance plans to help consumers make informed choices and avoid mistakenly paying for a plan that does not provide them the coverage or protection they expect,” said HHS Secretary Becerra. “Over the past three years, we have helped more people gain access to high-quality, affordable coverage and more than 300 million Americans are covered for the first time ever. We want everyone to have the peace of mind that comes with having coverage that includes the protections and benefits they expect.”


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