The IRS, the Employee Benefits Security Administration (EBSA), and the Centers for Medicare and Medicaid Services (CMS) are seeking public comments on proposed regulations that would change the definition of short-term, limited-duration insurance so that offering it for longer periods of time would still exempt it from the definition of individual health insurance coverage under the Affordable Care Act (ACA).
Short-term, limited-duration insurance is a type of health insurance coverage that is designed to fill temporary gaps in coverage that may occur when people are transitioning from one health insurance plan to another. This type of insurance is exempt from the ACA’s individual-market requirements because it is not considered individual health insurance coverage under the ACA.
These short-term insurance plans offer less benefits when compared to longer-term comprehensive insurance plans that are offered on government healthcare exchanges or by employers under ACA regulations. Insurers offering these short-term plans can turn down applicants because of their medical history and charge higher premiums for preexisting medical conditions, things not allowed under health insurance plans governed by the ACA.
The proposed rulemaking, a result of President Trump’s Executive Order 13813, proposes that people be allowed to purchase short-term insurance for up to 364 days, an increase from its current term limitation of up to 90 days that was established in 2016. In a press release, the U.S. Department of Health and Human Services (HHS) said that the proposed rule would be reverting to the previous definition of short-term, limited-duration insurance which permits coverage for nearly a full 12 months.
The proposed rulemaking also includes measures to help consumers who purchase short-term, limited-duration policies understand the coverage they are getting. The proposal would require one of two versions of a notice to appear in the contract and in any application materials that the plan is not required to comply with ACA provisions.
Comments are due by 5 p.m. ET on April 23.
Written comments may be submitted as follows:
1. Electronically at https://www.regulations.gov. Follow the “Submit a comment” instructions.
2. By regular mail to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-9924-P, P.O. Box 8010, Baltimore, MD 21244-8010.
3. By express or overnight mail to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-9924-P, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
4. By hand or courier ONLY to the following addresses prior to the close of the comment period: For delivery in Washington, DC—Centers for Medicare & Medicaid Services, Department of Health and Human Services, Room 445-G, Hubert H. Humphrey Building, 200 Independence Avenue SW, Washington, DC 20201.
The announcement of the proposed rulemaking, as listed in the the Federal Register, can be found by clicking here.
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