This is the Cato Daily Podcast for Friday, September 7th, 2018.

I'm Caleb Brown.

States are responding to a new and freer market for health insurance with the federal expansion of so-called

short-term health insurance plans, and the response so far isn't very good.

Michael Cannon directs health policy studies at the Cato Institute.

He argues that by severely

limiting access to these health insurance plans, state lawmakers and

governors may end up leaving many Americans exposed to high medical bills,

inaccessible health care, and bankruptcy. We spoke today.

So the federal government has effectively legalized some short-term health care plans. What does that mean in short of time as you can tell me?

Well, it's actually more expansive than that. What the federal government has done is created

a parallel market, a parallel and free market for health insurance.

Obamacare continues to exist, but by loosening the rules governing so-called short-term limited duration health

insurance plans, the federal government has created this this parallel market

where there are no federal regulations on these health

insurance plans. So we actually have a head-to-head competition or race now between

Obamacare, which is a very government heavy way of trying to provide health insurance protection to people who get sick, and a market system for

doing the same thing.

All right, so what has been the state response and what is, what has this parallel market,

what does it invite states to do in order to accommodate these kinds of plans?

So notice that I said there are no federal rules governing these plans.

There are a couple, but they're really very minor.

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