Breaking Down ‘Junk’ Health Insurance: Biden Introduces New Rule to Limit Short-Term Plans

President Joe Biden recently met with his Competition Council to discuss ways of making healthcare more affordable. During the meeting, he announced a new rule aimed at cracking down on what he referred to as “junk” health insurance plans. These plans offer inexpensive coverage but often provide minimal services, leaving customers with high medical bills.

The Biden administration has described these plans as a scam that lured individuals into paying monthly premiums but failed to offer adequate coverage when needed. The new rule aims to limit short-term insurance plans to a maximum of seven months, down from the previous allowance of up to three years. Plans will be required to clearly outline the coverage provided and any limitations.

Short-term insurance plans have become more prevalent following a 2018 rule change under the Trump administration. Unlike plans under the Affordable Care Act, these short-term plans do not have to adhere to the same consumer protection standards. The White House argued that allowing insurance companies to offer these plans without adequate regulations could lead to loopholes that circumvent important protections, such as coverage for pre-existing conditions.

Supporters of the Affordable Care Act are concerned that short-term plans may draw in younger, healthier individuals away from ACA plans. This could impact the funding and sustainability of the ACA on a national level. President Biden’s administration is taking steps to address these concerns and ensure that individuals have access to quality healthcare coverage without falling victim to subpar insurance plans.

In summary, President Joe Biden has introduced a new rule aimed at limiting short-term insurance plans and cracking down on what he refers to as “junk” health insurance. The rule aims