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Judge Upholds Trump Rule Expanding Non-Obamacare Plans

Yuval Rosenberg

A federal judge ruled Friday that the Trump administration can proceed with its plan to expand the sale of health insurance plans that don’t meet Obamacare coverage standards.

U.S. District Judge Richard Leon in Washington rejected insurance companies’ effort to block the administration’s new rules

“Not only is any potential negative impact” from the rule “minimal, but its benefits are undeniable,” Leon wrote in a 40-page ruling on Friday, according to Bloomberg News. He added that there’s no evidence the rule “is having or will have the type of impact -- substantial exodus from the individual market exchanges -- that would threaten the ACA’s structural core.”

Under the regulation issued last year, short-term health insurance plans, originally intended to bridge temporary gaps in individual coverage, will be allowed to last up to 364 days instead of just three months, and they can be renewed for three years. Such plans don’t have to meet essential benefit requirements set by the Affordable Care Act, like covering maternity care and prescription drugs. They can also deny coverage to people with pre-existing medical conditions.

Health care experts and the insurers who brought the lawsuit have argued that those looser rules and wider availability of what some have derided as “junk” insurance plans could siphon off younger, healthier individuals from the Obamacare markets, resulting in higher premiums for the remaining population.

The Association for Community Affiliated Plans (ACAP), the plaintiff in the case, said that it would appeal the decision. "We remain firm in our contention that the Trump administration’s decision to expand dramatically the sale of junk insurance violates the Affordable Care Act and is arbitrary and capricious," ACAP CEO Margaret Murray said in a statement. “We are confident that the appellate court will see this differently.”

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