Are Short-Term Plans Bad for Consumers, Individual Market?

A new report prepared for the Leukemia and Lymphoma Society by actuarial firm Milliman Inc. concludes that short-term limited-duration (STLD) health plans expose enrollees to substantial financial risk, and that widespread enrollment in STLD plans by consumers would drive up premium costs. But some health policy experts tell AIS Health that, while STLD plans are undoubtedly a riskier proposition for consumers than more robust insurance, their impact on the broader marketplace is not clear.

In August 2018, the Trump administration issued a final rule that loosened the regulations governing STLD plans, allowing them to cover individuals for up to 364 days and be renewed up to 36 months. When the ACA was enacted, STLD plans were initially meant only to serve as stopgap coverage for consumers who lost coverage unexpectedly but didn’t qualify for a special enrollment period, so the Obama administration allowed the plans to last only three months.

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