April 17, 2024

Biden wants to torpedo short-term health insurance

While campaigning for the presidency in 2019, Joe Biden assured voters that he would not end private health insurance plans. He even said the Audience in Iowa“If you have private insurance, you can keep it” a dangerous echo of President Barack Obama 2013 “Lie of the Year.”

But over Independence Day weekend, the Biden administration did Announced a new rule that would severely restrict Americans from purchasing short-term, limited-duration insurance plans. This rule would essentially eliminate the health insurance plans of more than 1.5 million Americans.

In 2018, the the Trump administration he issued a rule that made it much easier for Americans to buy such short-term plans for as long as 12 months (rather than three) and renew them for up to 36 months.

It’s also important to note that Trump’s rule requires issuers of short-term, limited-period insurance to display “one of two versions of a consumer notice prominently in consumer materials explaining the policy they are purchasing.”

At the time, Health and Human Services Secretary Alex Azar said the goal was to “bring more affordable insurance options back to the market, including by allowing the renewal of short-term plans. These plans are not for everyone, but they can provide a much more affordable option for the millions of men and women who have been forgotten by the current system.”

Trump’s administrator for the Centers for Medicare & Medicaid Services, Seema Verma, said the rule opens the door to new, more affordable coverage options for millions of middle-class Americans who have been priced out of ACA plans.

There are disadvantages to short term insurance plans of limited duration. If you have pre-existing health conditions, they don’t have to cover you. But unlike plans available under the Affordable Care Act (aka ObamaCare) they offer consumers broad flexibility and catastrophic coverage at a low price point.

For many Americans, the short-term plans have been a great choice, with premiums and deductibles that are extremely affordable compared to their ACA counterparts. For those who are between jobs, in school or unable to sign up for employer-provided insurance, health insurance has become a lifesaver.

But, despite the fact that more than 1.5 million Americans have chosen to enroll in these short-term plans, the Biden administration is determined to end this popular health insurance option.

According to the Biden administration, these short-term plans are “junk plans” because, unlike ACA plans, they do not offer comprehensive coverage options. But that’s the whole point of these plans. They are intended as a stop-gap health insurance option for people between jobs or people who do not need or want comprehensive coverage, or to pay the attendant costs that result from such coverage.

Under the current rule, s a wide range of short-term options, with some starting as low as $55 per month for individuals. On the other hand, the least expensive ObamaCare option, the Bronze plan, repeated costs on average. ObamaCare insurance can run more than $1,000 a month for a 40-year-old couple with one child. And even at that price point, these plans can carry family deductibles more than $18,000 per year.

The Biden rule hates federalism. For this writing, 38 states offer short-term plans, with a range of renewal limits. Some states, such as California and New York, do not offer them at all. This is an element of the “laboratories of democracy” at work, in the words of Supreme Court Justice Louis Brandeis.

But under Biden’s plan, no state would be allowed to offer such plans at all. This will further centralize power in Washington and empower DC bureaucrats.

As House Ways and Means Chairman Jason Smith (R-Mo.) said of Biden’s new rule, “The American people, not Washington bureaucrats, should be the ones deciding what health care coverage is best for them and their families.”

The good news is that Biden’s rule is not permanent; the next administration can change it. But that is empty for the 1.5 million Americans who are about to kick their private insurance, despite Biden’s promise that he would never do such a thing.

Chris Talgo is editorial director of the Heartland Institute.

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