On Wednesday, the Department of Health and Human Services (HHS) announced that they would begin cracking down on short-term health insurance policies. This is a move which is necessary to ensure that the Affordable Care Act (ACA) remains stable, and ensures that premiums remain on a stable footing.
So what is short-term health insurance? As United Healthcare notes, these are policies which can last anywhere from a month to a year. They are generally cheaper than normal health insurance policies, but do not meet the minimum coverage requirements under the ACA. This means that users may be subject to the tax penalty covered by the ACA in addition to paying for short-term insurance.
Short-term policies are ostensibly designed so that people temporarily without health insurance can stay insured until they can get long-term insurance from another provider. That goes beyond just asking, what is spina bifida, if your child suffers from the disease. But what some young, healthy individuals have realized is that even with the aforementioned tax penalty, short-term insurance is cheaper. Consequently, the “short-term” insurance becomes long-term, with users just renewing the short-term contract year after year.
So what is the problem? The problem is that it hurts the ACA and those who depend on its protections to keep health insurance. Short-term users are proliferating due to the cheaper costs, and the Wall Street Journal reports that sales are up by more than 100 percent.
But while this may seem cheaper, using short-term insurance is not a good deal for the users nor the country. First, many users don’t realize that short-term insurance does not cover the same things which long-term insurance plans do. Furthermore, short-term plans have the option to deny patients who they feel to be health risks, while long-term plans cannot under federal regulation.
This means that young, healthy individuals can stick with the short-term plans, while the ACA is left to handle less well-off and healthy individuals. This would mean that premiums would have to be raised, leaving many people dependent on government care right back where they started.
Conservative sites like the Investor’s Business Daily have naturally attacked such reforms, noting that “The growth of the short-term insurance market… is an indication of just how bad a deal many people think they get from ObamaCare.” And in a sense, they are right. Some patients who will have to pay more for premiums under a long-term may be worse off in the short term.
But over the long term, it will benefit the country as a whole. America cannot call itself a civilized nation if it is willing to let the poor and destitute become bankrupt or worse thanks to medical bills. And if young people flee from the ACA to pursue short-term insurance, it will harm our medical insurance and the nation.
Short-term insurance should be used over the short term. Using it over the long term is a loophole which some patients may use try to escape the costs of the ACA, and it is sensible for the HHS to close it. And conservative attempts to argue against it just shows that they will use any means to shut down the ACA and let patients die.