The Trump administration launched a new rule on Tuesday that will expand short-term health insurance plans, offering Americans more affordable health care options compared to Obamacare.
“Americans need more choices in health insurance so they can find coverage that meets their needs,” said Health and Human Services (HHS) Secretary Alex Azar in a statement on Tuesday. “The status quo is failing too many Americans who face skyrocketing costs and fewer and fewer choices. The Trump Administration is taking action so individuals and families have access to quality, affordable healthcare that works for them.”
President Donald Trump signed an executive order in October to expand short-term, limited-duration health insurance plans. Before the executive order, Americans could only purchase these short-term health insurance plans for a maximum of three months; thanks to President Trump’s executive order, Americans can now retain the short-term health plan for any period under 12 months.
Short-term health insurance plans do not have to comply with all of the Obamacare insurance regulations such as community rating and essential health benefits, allowing Americans to have more affordable health insurance options.
The HHS argues that this option remains more important than ever given that insurance premiums have more than doubled under Obamacare and that half of American counties only have one individual insurance carrier to choose from in 2018.
The HHS also found that short-term health insurance options remain more affordable than Obamacare insurance plans. In the fourth quarter of 2016, a short-term health insurance plan cost $124 per month, while an unsubsidized Obamacare plan cost $393 per month.
In October, Sen. Rand Paul (R-KY) praised Trump’s executive order as “the biggest free-market reform of health care in a generation,” adding that it will allow Americans to purchase health insurance across state lines.
Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma claimed in a statement on Tuesday, “Americans who find themselves between jobs or simply can’t afford coverage because prices are too high will be helped by President Trump’s Healthcare for All Executive Order.”
Verma added, “In a market that is experiencing double-digit rate increases, allowing short-term, limited-duration insurance to cover longer periods gives Americans options and could be the difference between someone getting coverage or going without coverage at all.”