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Short-Term Health Insurance Soon Available For Up To 36 Months

New Rule Loosens Current Restrictions

Effective October 2, 2018, a new rule will allow individuals to purchase short-term, limited-duration health insurance coverage for a period of less than 12 months, and renew such coverage for up to 36 months. Under current law, the maximum coverage period for short-term, limited-duration health insurance is less than 3 months, and these policies cannot be renewed.

Notably, short-term, limited-duration health insurance is:

  • Not required to comply with the Affordable Care Act’s ban on pre-existing condition exclusions and lifetime and annual dollar limits.
  • Not required to comply with the Affordable Care Act’s essential health benefits requirement, which requires individual health insurance policies to cover, among other things, hospitalizations, emergency services, and maternity care.
  • Not “minimum essential coverage,” meaning that policyholders may remain liable for an individual mandate penalty for any month in 2018.

Click here to read the new rule. A fact sheet is also available.

Check out our Health Care Reform section for more on the Affordable Care Act.

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Reminder: Individual Mandate Remains in Effect for 2018

Requirement is Effectively Repealed Beginning in 2019

Individuals are reminded that the section of the Tax Cuts and Jobs Act which effectively repealed the individual shared responsibility provision (“individual mandate”) of the Affordable Care Act does not become effective until 2019. As a result, individuals are required to have minimum essential health coverage, qualify for an exemption from the requirement, or pay a penalty tax for 2018.

Our Individual Mandate (Individual Shared Responsibility) section provides additional information on the individual mandate.