Deciphering Short Term Health Insurance
Medical costs are outrageously high, and being without health insurance can be scary. Even if you’re only going to be without coverage for a few months, you’re probably aware of the risks associated with not having health insurance.
Fortunately, there’s a better option than dutifully taking your daily multivitamin and hoping that nothing catastrophic happens while you’re waiting for your traditional health insurance to kick in.
Short-term health insurance is a special policy designed to provide coverage during times of transition when traditional health insurance coverage may be impractical or unavailable. For example, a person may opt to purchase this coverage when they’ve taken a new job and have a waiting period before their long-term policy begins, or if they’re rolling off their parents’ insurance, or if they’re losing coverage following a death or divorce.
Why Do I Need Short Term Health Insurance?
Even if you’re a relatively healthy person, the thought of being without health insurance is a risky move. After all, the cost of health care is astronomical, and an unexpected visit to the emergency room can leave you with a bill of tens of thousands of dollars.
Even if you’re a relatively healthy person, the thought of being without health insurance is a risky move. After all, the cost of health care is astronomical, and an unexpected visit to the emergency room can leave you with a bill of tens of thousands of dollars.
Circumstances that can leave you without health insurance:
- Job loss
- Switching to a new job
- Aging off your parent’s plan
- Cost of your current plan too expensive
- Losing coverage due to divorce or death
- No longer qualifying for Medicaid or CHIP
- Moving outside of your current plan’s service area
- Losing your student plan because you’ve graduated
- Moving back to the United States after living abroad
- Not having a qualifying “life event” or it’s not “open enrollment” to get onto a qualified health plan.Expiration of your current health plan, including COBRA
Because something as commonplace as a respiratory infection can become financially devastating without health insurance coverage, protecting yourself from gaps in coverage is necessary. Here’s where short-term health insurance comes into the picture. Short-term health insurance is ideal for people who need coverage while they weigh their long-term options or wait for more permanent coverage to kick in.
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Coverage Under Short Term Health Insurance
With short term health insurance, applicants can receive coverage as early as the day after they’ve submitted their application.
It’s important to note that in most cases, short term health insurance policies do not cover pre-existing conditions. What qualifies as a pre-existing condition varies from one state to another, but short-term health insurance plans do not provide coverage for those who have been diagnosed with or received treatment for a condition within the past two to five years.
Is Short Term Health Insurance “REAL” Insurance?
Just like any product or service from any industry, there will be good products and bad products. There has been news in the past few years of people/companies scamming individuals by selling them fake health insurance; so err on the side of caution.
A recent blog post of ours warning people about this: Health Insurance Scams
We Sell Quality Health Plans From Reputable Companies
Obviously, we only sell the good products from reputable and well-known Health Insurance companies. These are real PPO (Nationwide Coverage) Health Insurance plans from United Healthcare. We have gone to great lengths to make certain our “Featured” PPO plans provide some of the health insurance industries finest QUALITY products we have found and can stand behind. All the packages we sell have very reliable health insurance coverage with United Healthcare PPO (their “Choice” network) and has nationwide coverage. These PPO plans are available to start today, or January 1st, whichever start date you wish.
You will go through an underwriting process, which means these plans work best for those individuals and families that don’t have pre-existing conditions such as: pregnant, blood disorders, liver, kidney or heart disorders, COPD, diabetes, cancer, MS, Crohn’s, ulcerative colitis, drug or alcohol abuse/treatment, and several others. If you feel like you are relatively healthy, the packages we offer could work very well for you. If you do have serious pre-existing conditions that you need covered, we recommend you speak with one of our agents and possibly stay with an ACA (Obamacare) health insurance plan.
What Is Covered Under Short Term Insurance
As with any type of insurance, the specific benefits that you’ll receive will vary widely. However, short-term insurance generally covers the following:
- Surgery
- Prescriptions
- Wellness visits
- Ambulance service
- Emergency room visits
- Administration of anesthetics
- Intensive or specialized care
- Organ, tissue, bone marrow transplant
- Inpatient and outpatient doctor visits
- Hospital room, board, and general nursing care
- Outpatient hospital surgery or ambulatory surgical center
It is important to know what your plan does cover. Plans will vary so you’ll want to read the Evidence of Coverage and plan documentation.
What Is Not Covered Under Short Term Insurance?
Short term health insurance plans are not required to meet ACA guidelines and generally do not provide the same coverage that permanent health insurance does. Common exclusions include:
- Coverage for pre-existing conditions
- Substance abuse treatments
- Mental health services
- Maternity care
It is important to know what your plan does not cover. Plans will vary so you’ll want to read the Evidence of Coverage and plan documentation.
How Some Are Using Short Term Health Insurance
Healthy individuals who are unwilling or financially unable to sign up for a long-term ACA-compliant health insurance plan may opt instead to sign up for a more affordable short-term health insurance plan. Some insurers even provide back-to-back 90-day policies, letting applicants go through an initial medical underwriting process and then re-enroll in a new plan every 90 days. Those who go this route will have uninterrupted health insurance coverage, albeit with fewer benefits, higher co-pays, and limited consumer protections.
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The Downsides of Back-to-Back Short Term Health Insurance Policies
While many insurers are striving to make it easier for applicants to get affordable health insurance coverage via extended short-term health insurance plans, there are potential downsides to this back-to-back approach.
First of all, If you enroll in multiple short-term health insurance plans and develop a medical condition during the time you’re covered under one of the plans, you’ll likely have to enroll in an ACA-compliant health insurance plan once your pre-purchased series of short-term health insurance plans is up.
Additionally, if you became ill or suffered an injury, even if you met your out-of-pocket deductible during one term, your deductible would reset to zero when you re-enrolled. This scenario could end up costing significantly more than a traditional health insurance plan (though not as much as you’d pay if you had no health insurance).
Before making changes to your health insurance, it’s important to speak with your health insurance agent. They will provide guidance and ensure that you choose a plan that meets your needs and budget.
Is Short Term Insurance a Good Option for Me?
As its name suggests, short term health insurance is not suitable for the long-term. While it’s generally easy to qualify for this type of coverage, and premiums tend to be lower, short term insurance has its shortcomings. For example, the benefits generally won’t cover pre-existing conditions, some plans may, but generally they will not. Also, prescription coverage may not be what you think it is, because short term plans are designed to not cover pre-existing conditions. You can also be turned away depending on your health history, and maternity coverage is usually excluded.
What Is Changing?
Prior to 2016, short-term health insurance had been allowed to last as long as 364 days. The Obama administration shortened it to three months to prevent individuals from using this coverage to circumvent the health care law. In October of 2017, the Trump administration proposed to reverse this rule, making it possible once again for people to purchase non-ACA-compliant coverage for nearly an entire year.
What Does This Mean for Me?
People who are young, healthy, and unable to receive subsidized health insurance through their employer may opt to forgo an ACA-compliant coverage option in favor of a more economically priced short-term health care plan. In fact, some short-term health care plans may cost as little as 20 percent of the cheapest Obamacare plan.
If you do become sick or injured, your out-of-pocket expenses may end up being significantly higher than you expected. Then, once your plan’s term ran out, you probably wouldn’t be eligible to sign up for short-term insurance again and you’d have to sign up for an ACA-compliant long-term plan.
Short Term Insurance vs. Other Alternatives
We do recommend the short-term plans over many other health insurance alternatives (like discount programs, indemnity programs, or mini-medical plans). A short-term plan is more comprehensive coverage than any of these other alternatives, but it is important to compare policies and ensure that the coverage you’ll receive is adequate for your needs.
Nevada Insurance Enrollment Is Here to Help
While short term health insurance may be an ideal temporary solution for some people, others, especially those with pre-existing conditions, may not receive the coverage that they need. If you need health insurance, our health insurance agents are here to help you weigh your options and determine what type of policy will meet your needs and budget.
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President Obama signed into law the Affordable Care Act (ACA)
We are hearing that this law will insure more Americans and drive insurance costs down. Of course, I’m pretty skeptical it will drive costs down.