Indiana legislates new protections for short-term insurance plans effective July 2025

On January 8, 2025, Indiana lawmakers introduced Senate Bill 165, a legislative proposal aimed at regulating short-term health insurance plans. The bill seeks to enhance consumer protections by prohibiting insurers from retroactively canceling these plans, except in cases of fraud, effective July 1, 2025. This provision aligns with the standards set by the Patient Protection and Affordable Care Act (PPACA).

Key amendments within the bill clarify the definition of accident and sickness insurance, explicitly excluding certain types of coverage such as dental, vision, and long-term care insurance. Notably, the bill stipulates that short-term insurance plans must have a maximum term of 364 days and an annual limit of at least $2 million, ensuring a baseline of coverage for consumers.

The introduction of Senate Bill 165 has sparked discussions among stakeholders, with proponents arguing that it will provide essential protections for individuals seeking temporary health coverage. Critics, however, express concerns that the restrictions may limit the availability of short-term plans, which are often seen as a more affordable option for those in transition between jobs or waiting for other coverage to begin.

The implications of this bill are significant, as it addresses ongoing debates about the adequacy of health insurance options in Indiana. Experts suggest that while the bill aims to protect consumers, it may also lead to increased premiums or reduced availability of short-term plans, potentially impacting those who rely on them for immediate health coverage.

As the legislative process unfolds, the future of Senate Bill 165 remains uncertain, with further discussions and potential amendments anticipated in the coming weeks. The bill's progress will be closely monitored by both supporters and opponents, as it could reshape the landscape of health insurance in Indiana.