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White House rolls out new steps to try to protect people who buy short-term health plans

Many people rely on short term plans for health insurance, but they can also lead to expensive, surprise medical bills.

On Thursday, the Biden Administration announced new changes to short-term health insurance. Those are the plans that offer temporary coverage such as when you’re between plans or signing up outside of enrollment periods.

The new federal rule will limit the sale of new short-term insurance plans to three months, and they can only be renewed for a maximum of four months total.

Previously, these plans could be renewed for up to three years under the former Donald Trump Administration.

The rule will also require companies to provide patients with clear explanations of their benefits.

“When you buy health insurance, it should actually be health insurance,” said Jon Donenberg, Deputy Director of the National Economic Council. “The current practice of offering low quality insurance that people pay into but doesn’t really give you coverage when you need it is really a bait and switch.”

But conservative critics believe these new limits may cause some insurance companies to cancel patient plans. The Washington New Bureau talked with Brian Blase, who runs the Paragon Health Institute, a conservative think tank. He argues this rule will also limit competition for health plans.

That’s a terrible rule…. It is making coverage worse,” said Brian Blase, President of Paragon Health Institute. “There’s no winners, it’s all losers. It is about taking away coverage from people and benefiting insurers that are just offering ACA plans.”

Currently, temporary health plans aren’t available at all in 14 states and in Washington D.C.