Even if you’re a relatively healthy person, the thought of being without health insurance can be scary. 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.
There are plenty of life circumstances that can leave you without health insurance, including:
♦ Job loss
♦ Cost of your current plan too expensive
♦ Aging off your parent’s plan
♦ Moving back to the United States after living abroad
♦ Expiration of your current health plan, including COBRA
♦ Switching to a new job
♦ Losing coverage due to divorce or death
♦ Moving outside of your current plan’s service area
♦ No longer qualifying for Medicaid or CHIP
♦ Losing your student plan because you’ve graduated
Because something as commonplace as a respiratory infection can become financially devastating without 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.
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:
♦ Hospital room, board, and general nursing care
♦ Intensive or specialized care
♦ Emergency room visits
♦ Inpatient and outpatient doctor visits
♦ Wellness visits
♦ Ambulance service
♦ Organ, tissue, bone marrow transplants
♦ Outpatient hospital surgery or ambulatory surgical center
♦ Administration of anesthetics
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.
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. These plans are currently being worked on.
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. Be careful to keep a qualified health plan through 2018, however, because the tax penalty extends through 2018.
If you do become sick or injured, your out-of-pocket expenses may end up being significantly higher than you expected, as short-term health insurance plans typically cannot be renewed; you must reapply every time the term is up, and most states have a cap on the number of times you can purchase short-term health insurance. Additionally, if you did become sick or injured while on a short-term plan, 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.
Once longer short-term health care plans are made available to consumers, they may or may not be a suitable long-term solution. We’d recommend the short-term plans over many other options, like a discount program, an indemnity program, or a mini-medical plan for certain. A short-term plan, although may not be renewable if you become very ill, you will have very good coverage while you do have the plan, because it is more comprehensive coverage than a discount program, an indemnity program, or a mini-medical plan. It is important to compare policies and ensure that the coverage you’ll receive is adequate for your needs.
PLEASE NOTE: We do caution you to look at the Rx prescriptions in the short-term plan if that is an important factor for you.