Can a state that wants to preserve ACA consumer protections protect itself from the executive order Trump signed today, which opens paths to segmenting the risk pools in the individual and small group markets? Consider the case of New Jersey, which had guaranteed issue (and, with no individual mandate, sky-high premiums) pre-ACA.
The Trump EO instructs Treasury, DOL and HHS to expand availability of short-term insurance, allowing it "to cover longer periods and be renewed by the consumer." That's understood to mean allowing coverage for up to a year -- and so, via renewal, indefinitely, though subject to medical underwriting at renewal as well as at first purchase. Short-term plans are not subject to ACA coverage rules.
At present, plan duration is limited to three months. Since that rule only went into effect this April, extending the term to up to a year is not a radical shift from the ACA status quo. But combined with weak enforcement of the individual mandate, and more exemptions from the mandate stemming from rising premiums, temporary plans available continuously are likely to weaken the ACA risk pool.
Temporary plans are subject to state regulation, however, and health law scholar Nicholas Bagley expects that to continue:
The Trump EO instructs Treasury, DOL and HHS to expand availability of short-term insurance, allowing it "to cover longer periods and be renewed by the consumer." That's understood to mean allowing coverage for up to a year -- and so, via renewal, indefinitely, though subject to medical underwriting at renewal as well as at first purchase. Short-term plans are not subject to ACA coverage rules.
At present, plan duration is limited to three months. Since that rule only went into effect this April, extending the term to up to a year is not a radical shift from the ACA status quo. But combined with weak enforcement of the individual mandate, and more exemptions from the mandate stemming from rising premiums, temporary plans available continuously are likely to weaken the ACA risk pool.
Temporary plans are subject to state regulation, however, and health law scholar Nicholas Bagley expects that to continue:
13/ The states should still retain authority to regulate short-term plans -- and to require them to adhere to ACA rules.— Nicholas Bagley (@nicholas_bagley) October 12, 2017
