Limitations of Short-Term Health Plans Persist Despite Predictions That They’d Evolve

By Dania Palanker, Emily Curran, Arreyellen Salyards

Short-term health plans were originally intended as a temporary lower-cost option for people who need catastrophic coverage during times of transition. Citing the need for a more affordable option in the individual marketplace, the Trump administration pushed to extend the contract terms on short-term health plans so they could be purchased as a substitute for year-long coverage.

2019 analysis by the Congressional Budget Office (CBO) projected that the industry would evolve and a new type of short-term health plan would likely become available that offers more comprehensive coverage, including protections against high cost-sharing and catastrophic medical costs. It was expected the industry would offer new plans that could compete with individual market plans. In their latest post for the Commonwealth Fund’s To the Point blog, the authors sought to determine if this projection has come true. They reviewed 414 plans with 12-month contracts sold on the online health broker website eHealth in Alabama, Oklahoma, Texas, Utah, and West Virginia. As part of their analysis, the authors looked at filings the plans made to regulators since the 2018 regulations were issued. You can read the findings from their analysis here.

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