HHS rule applies to short-term limited duration insurance (STLDI) plans sold or issued on or after September 1, 2024. A final rule announced by the Departments of Treasury, Health and Human Services, and Labor in March 2024, has imposed new nationwide duration limits on short-term limited duration insurance (STLDI) plans.
The rule – which applies to plans sold or issued on or after September 1, 2024 – limits new STLDI plans to three-month terms, and caps total duration – including renewals – at no more than four months.
A “renewal” includes a new policy issued by the same insurer (or another insurer in the same controlled group, meaning they’re treated as a single employer) within 12 months of the effective date of the first policy. So a person will not be able to purchase multiple consecutive policies from the same insurer or an affiliated insurer. This part of the rule helps to avoid scenarios in which consumers enroll in multiple STLDI policies without realizing that it isn’t comprehensive coverage.
The rule aims to ensure short-term coverage is used for temporary gaps between comprehensive policies, rather than as a long-term solution. It also helps consumers distinguish between ACA-compliant health insurance and STLDI, reducing the risk of inadvertently purchasing short-term coverage. But it also acts as a way to steer younger and healthier consumers to ACA plans, especially in states with less than 2 plan options such as Pennsylvania.
Questions about short term medical plans and how this may effect you? Contact your Total Benefit Solutions, Inc health insurance specialists at (215)355-2121