The Biden Administration has proposed regulations that would limit the maximum duration of short-term, limited duration insurance (STLDI) plans. 

Currently, STLDI plans can remain in effect for an initial term of 364 days. The plans can be renewed as long as the total duration does not exceed 36 months. Under the newly proposed regulations, STLDI plans can only have an initial term of up to 3 months, and the plans can only be renewed for a period of up to 1 additional month. The proposed rules would not impact existing STLDI plans that are in force. 

STLDI plans are exempt from the Affordable Care Act market reforms. These plans can use medical underwriting for eligibility and can exclude coverage for pre-existing conditions. STLDI plans also don’t have to cover preventive care or essential health benefits. 

Critics of STLDI plans view these programs as “junk insurance.” Proponents of STLDI plans view these programs as affordable alternatives to more expensive health insurance plans.

The proposed regulations were posted to the Federal Register on July 12, 2023. Anyone who wants to make a public comment can do so within 60 days of the regulations being published. If the proposed regulations are finalized, the new rules would take effect 75 days after the publishing of the final regulations.