Debate: Should Short-Term Health Policies Be Limited to 4 Months?
The Health and Human Services, Labor and Treasury departments have released final regulations that limit short-term limited duration insurance policies to no more than three months. With extensions or renewals, the maximum coverage period can be no more than four months.
Under the Trump-era rule, the maximum initial term could be as long as 12 months with a total coverage period of up to 36 months with extensions or renewals. The final rules also contain new notice requirements, so that a clear and concise notice must be placed on the front page of each policy.
The short-term policies are not subject to certain Affordable Care Act protections, including prohibitions on discrimination based on health status, preexisting condition exclusions or dollar limits on certain essential health benefits.
We asked two professors and authors of ALM’s Tax Facts with opposing political viewpoints to share their opinions about the final regulations limiting the permissible length of short-term limited duration insurance policies.
Below is a summary of the debate that ensued between the two professors.
Their Votes:
Bloink
Byrnes
Their Reasons:
Bloink: When taxpayers are permitted to purchase this non-comprehensive coverage for a longer period of time (before the final regulations, 12 months), they’re more likely to mistake this “skinny” medical coverage for comprehensive coverage. Limiting the duration of these policies to three months should alert taxpayers to the fact that these policies don’t provide the kind of robust coverage that ACA-compliant policies do provide. It also reaffirms that the role of STLDI is to provide temporary coverage, rather than an alternative to comprehensive coverage.
