Enhanced Short-Term Healthcare Plans

The law that established the Affordable Care Act (ACA, or Obamacare) mandates several criteria that health insurers must meet.  Among them are requirements to cover pre-existing conditions, and a limit on maximum out-of-pocket expenditures.

After several court rulings and Trump administration regulation changes, states can now permit policies that don't include these requirements if the policies cover the insured for less than one year.  Such policies are designed to cover short-term gaps in coverage and to bring more healthy people back into the health insurance market.


Under the first of these enhanced short-term plans, now offered in Idaho, healthy people can be charged less than those with pre-existing conditions, and a coverage delay can be introduced for those  same pre-existing conditions.  Out-of-pocket maximums are double those of coverage under the ACA, and deductibles are also considerably higher.

While the idea seems unattractive, it has been a popular success.  Idaho expected about 800 people to apply for coverage, yet over 3,000 have.  More than half of them accepted coverage when they were  rated at rates significantly less than the cost of policies that meet ACA requirements.

To avoid siphoning off healthier individuals into enhanced short-term plans and away from ACA plans, Idaho requires that insurance companies that offer enhanced plans to also offer ACA plans.  To keep rates for ACA plans from skyrocketing, pools for rating must include both types of plans, thus preventing the loss of healthy individuals to force up the cost of ACA plans.

Rate increases for coverage may not exceed 15% per year, despite the insurer's claims experience.

While some state's insurance commissioners are critical of Idaho's end run around the ACA, others believe this type of plan enables them to expand the number of people covered and offer individuals more choice.  Given the reception of Idaho's plan you can expect more states to allow similar policies.

An article with more details on the Idaho plan and the companies who offer the coverage can be found here.