One of the policies that Biden’s incoming administration is likely already setting its sights on is his alternatives to Obamacare, overturning the 2018 executive order that loosened up rules concerning short-term health insurance policies.
Democrats often called the plan sabotage, so there’s no doubt this is high on Biden’s list of priorities. And while this is only a small part of the insurance market, this move will be indicative of the kind of healthcare policy we are likely to see come about over the next four years.
Also known as short-term, limited-duration insurance, it is health insurance that primarily fills the gaps in coverage that an individual may face when transitioning from one long-term plan to another, as may happen when a person is in between jobs.
Since such plans were supposed to offer only short-term coverage, they were not subject to the benefit mandates and other regulations under the Affordable Care Act. Fearing that healthier people were using such plans as a way to avoid paying higher prices on the ACA exchanges, in 2016, President Barack Obama issued an executive order saying that the plans could only offer three months of coverage and could not be renewed.
In 2018, Trump loosened those restrictions considerably, allowing short-term plans to offer coverage for up to one year and to be renewable for up to three years.
Short-term plans are not a large market. Jeff Smedsrud, CEO of Pivot Health, which sells short-term plans, estimates that about 700,000 people had such plans at any given point in time prior to the Trump executive order. After the order, he suggested, it grew to 900,000 to 1 million.
Still, this market could end up shrinking even further under Biden’s leadership. Smedsrud believes it’s likely that Biden will roll back the rule put in place by the Trump administration.
“It is likely the Biden administration will propose new rules, but it should only be after the COVID pandemic is under control and the Supreme Court has taken action [on the recent Obamacare case],” he said. “Now is not the time to disrupt health insurance markets.”
These people will not stop until our healthcare system is a single-payer one like they have in Canada and the United Kingdom, despite the fact that such a system causes a massive reduction in quality of care, long wait times for treatment, and so on.
What we really need is to have the restrictions keeping folks from buying insurance across state lines removed. More competition translates into cheaper insurance policies. It’s simple.
Maybe one day we’ll actually get to see that in action.