A new study released by the Kleimann Communications Group finds that consumers are facing significant challenges when it comes to understanding the limitations of Short Term Health Plans, also called Short Term Limited Duration Insurance or STLDI. These are health insurance plans that are exempted from many of the consumer protection and coverage requirements of the Affordable Care Act (ACA).
The Trump Administration recently expanded the availability of these plans, championing for them as a cheaper alternative to ACA Coverage, increasing the maximum policy term to one year, but making them renewable for up to three years. The plans had previously been limited to three months, and were non renewable.
There is concern that by allowing these bare-bones policies to be sold as a long term alternative to ACA compliant plans that there could be harmful ramifications for consumers. While the ACA requires that individual plans meet certain standards, STLDI plans do not have to comply with those same standards.
While STLDI plans may look like a great value as they generally have lower premiums than ACA compliant plans, they offer less benefits and deny coverage for serious medical needs leaving enrollees exposed to unlimited out of pocket costs if they get sick or injured. This could be catastrophic for older adults or those with pre-existing conditions.
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