Advocate for Entrepreneurs Lauds Final Rule on Short-Term, Limited Duration Health Coverage

By at 1 August, 2018, 12:14 pm



Washington, D.C. – Today, the departments of Health and Human Services, Labor and Treasury issued a final rule on short-term, limited-duration plans. The final rule will extend the current 3-month limitation on the duration of these plans to under twelve months, allow for a renewal of the plans for no longer than 36 months, and require clear communications for consumers to help them understand the coverage level they are receiving.  Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan lauded the final rule and said this practical health coverage option is important for the self-employed, startups, and people who transition in and out of the workforce due to personal reasons and the need for flexibility.

“High health coverage costs are weighing down growth, entrepreneurship and dynamism in the U.S. economy. This cost drain must be addressed to enable strong and sustainable economic growth, more startup activity and the freedom people need to move in and out of the workforce if they require such flexibility. In addition, millions of Americans still lack coverage despite the promises of Obamacare. Health insurance remains too expensive, and there are limited choices in the marketplace. This rule combined with other actions, such as the final rule on association health plans and House action to expand health savings accounts, will lead to more reasonable costs, increased choices in the marketplace and put consumers back in control of the health care system,” said Kerrigan.

“Limited-duration health care plans play a vital role in the marketplace, particularly when individuals and their families need coverage during career and work changes.  Many more people are cycling between full-time jobs and ‘gig’ work, and limited-duration health plans help fill the ‘coverage gap’ at a reasonable cost.  Our regulatory system must take into account how people currently work, how they want to work if they have major life changes, or want to open a business.  Affordable health coverage will provide Americans with the flexibility they need when there is a break in coverage. The changes in the final rule make practical sense and align with workforce mobility trends. The final rule will also encourage more people to pursue business ownership,” added Kerrigan.

It is forecasted that by 2027, more than half of the workforce will have been or will be independent contractors. In 2017, 57.3 million Americans (36% of the workforce) did freelancing work. Sometimes these turn into full-time businesses and other times freelancers cycle back into full-time jobs. Policies that make health coverage plans more practical, accessible and affordable is an important policy priority for SBE Council. Read SBE Council’s 2018 agenda for Health Care Affordability and Innovation here.

CONTACT:  Karen Kerrigan 

SBE Council is a nonpartisan, nonprofit advocacy, research and education organization that works to protect small business and promote entrepreneurship. For nearly 25 years SBE Council has worked to successfully implement a range of policy and private sector initiatives to strengthen the ecosystem for startups and small business growth. To learn more, visit SBE Council’s website: Follow on Twitter: @SBECouncil

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