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Appeals court upholds sale of short-term limited duration insurance plans 

The plans do not have to comply with the comprehensive benefits of the Affordable Care Act.

Susan Morse, Managing Editor

In a win for the Trump Administration, an appeals court on Friday ruled that the sale of plans that don't comply with the Affordable Care Act can continue.

In the 2-1 decision, the U.S. Court of Appeals for the District of Columbia Circuit said the sale of short-term limited duration insurance plans is neither contrary to law nor arbitrary and capricious.


The Trump administration has pushed for the sale of short-term limited duration insurance plans as a less expensive health coverage alternative, though the plans are not as comprehensive.

The plans offer lower premiums because they are not mandated to follow the coverage of an ACA qualifying health plan.

In August 2018, the Trump Administration finalized a rule for short-term, limited duration insurance plans that extended their availability from three months to one year and allowed individuals to renew these plans for a maximum of up to three years.

Traditionally, short-term plans covered a maximum period of three months, without the ability to renew. They were designed to provide temporary coverage for individuals transitioning between health policies, such as an individual in between jobs, or a student taking a semester off from school.

The Association for Community Affiliated Plans and other organizations sued, calling these plans, "junk insurance."

Insurers were concerned that the short-term plans would encourage healthy consumers in the ACA market to leave to purchase the less expensive coverage.

In 2019, a district court dismissed the lawsuit. The Association appealed.


The Trump Administration has long tried to dismantle President Barack Obama's signature healthcare law that sets minimum health insurance standards. 

In June, the Administration filed a brief with the Supreme Court to invalidate the ACA.

Allowing short-term health plans is another shot at the erosion of the ACA.


"The central issue, then, is not whether an STLDI (Short-Term Limited Duration Insurance) plan is better than nothing, but whether such a policy is an appropriate substitute for a plan offering the comprehensive coverage and fair access that Congress deemed essential," said dissenting Circuit Judge Judith Ann Wilson Rogers.

Twitter: @SusanJMorse
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