Life happens. You’re in between jobs. You graduate college and are looking for a full-time gig with health insurance. You’re going through a divorce and lose access to your spouse’s major medical plan. How will you pay for healthcare?
When you’re uninsured and worried about unexpected medical bills, it’s time to consider short term health insurance.
What is short term health insurance exactly? A short term health plan, (also referred to as “short term medical” and “temporary health plans”), provides temporary benefits that help pay for healthcare when you don’t have major medical insurance.
This coverage lasts for as few as 30 days, which means it’s just right when you’re looking for a COBRA alternative if you’re temporarily unemployed and need health insurance or waiting until your employer benefits begin.
Why buy temporary health coverage?
You might be tempted to skate by uninsured until you have major medical insurance again, whether through a job or a government marketplace.1 But it’s important to keep in mind that if you need healthcare in the meantime, you could wind up paying for it 100% out of pocket.
That’s where short term medical comes in. The benefits of short term healthcare coverage include:
1. Financial protection
Short term policies can help pay for unexpected healthcare when you need covered services for an illness or injury. After you meet your deductible, your benefits will help with covered expenses.
When you’re in between major medical plans (i.e., Affordable Care Act or Obamacare), you might be looking to save money. And, generally speaking, short term premiums tend to cost a fraction of major medical premiums because they are much less robust. For example, they don’t include essential health benefits coverage or cover pre-existing conditions.
3. Flexibility and freedom
Short term coverage is available year-round. There isn’t a special open enrollment period, which means you can apply anytime (remember that applications are subject to carrier approval).
Most healthcare providers accept temporary health insurance as they do major medical. It’s also possible that you can choose your preferred doctors and hospitals because not all short term health plans require you to visit network providers.
Furthermore, some have optional networks with access to discounts when you see a provider who belongs to the network. Read plan details to determine what, if any, network restrictions may apply to the coverage you choose.
4. Custom coverage
The phrase “one size fits all” doesn’t apply to temporary health insurance plans. They can last anywhere from 30 to 364 days depending on your state. You can also choose from a range of deductible options that help you strike the right balance between premium and out-of-pocket affordability.
5. Fast benefits
Short term polices can be quickly obtained. As mentioned earlier, they are available year-round.
You can apply and enroll online 24 hours a day, within just a few minutes by filling out an application and answering a brief health questionnaire. If your application is accepted, you can choose to begin coverage as early as the next day.
What healthcare will a short term plan cover?
You may already know that short term medical benefits are not the same as major medical benefits (i.e., an ACA plan). They are not subject to the Affordable Care Act (ACA), so they won’t have essential health benefits or be required to cover all of the preventive services listed in the ACA.
Even so, temporary medical plans do include a range of benefits that offer some financial protection from unexpected medical bills that result from serious medical events like a heart attack or stroke, as well as less serious medical events such as a broken leg or doctor’s office visit due to illness.
Here are some examples of the types of medical care commonly covered by short term health plans:
- Hospital room, board and general nursing care
- Emergency room visits
- Inpatient doctor visits
- Doctor office visits
- Surgical services
- Intensive or specialized care
Furthermore, some plans even cover a few basic preventive services such as a Pap smear, mammography or a prostate antigen test.
Others may include benefits for pre-existing conditions. It’s important to ask questions to verify what benefits the plan you are considering includes or does not include. Short term benefits vary from policy to policy.
How does short term health insurance work?
Temporary plans function a lot like major medical plans. You present your health insurance ID card at the time you receive healthcare services. Your healthcare provider bills your short term health insurance company, which then pays the amount covered by your policy. You will then be billed for your share.
How much does it cost?
Temporary coverage typically costs less than an unsubsidized Obamacare plan. Remember, ACA policies and short term policies are very different in terms of what they actually cover, which is why they can be priced so differently.
ACA insurance includes coverage for essential health benefits and are guaranteed issue, meaning you cannot be denied coverage based on health history or pre-existing conditions. Short term health plans don’t provide any of these specific coverages or guarantees. Your short-term policy premium will be based on a number of factors, including what coverages you elect.
Keep in mind that you can’t apply for ACA subsidies (i.e., premium tax credits and cost-sharing subsidies) for short-term medical insurance.
Want to find out how much it will cost you?
Estimate your monthly premium and compare policy options by getting an instant short term medical quote. It takes 1-minute and you will get a range of short term policies to choose from.
Is short term health insurance right for me?
Short term medical insurance can be helpful for many people, but it’s not necessarily a fit for everyone. Here are three things to keep in mind when making your decision:
Consider your life stage and circumstances
Temporary coverage can be a smart choice if you:
- are waiting for your employer-provided benefits to kick in
- missed open enrollment,
- are not eligible for special enrollment and need coverage
Consider your personal healthcare needs and budget
Some questions to ask yourself include:
How long will you need coverage? Currently, short term policies can last from 30 to 364 days depending on your state. If you need long-term coverage, you may want to consider an ACA plan.
Do you have pre-existing conditions? Many temporary health plans do not cover pre-existing conditions, though some do. You will be required to answer some health questions when applying for short term coverage, and your answers could impact your eligibility.
Are you eligible for an Obamacare subsidy? If you qualify for premium tax credits and cost-sharing subsidies to help reduce your monthly health insurance payments and covered out-of-pocket expenses, you may want to apply for an ACA plan. Short term medical is not eligible for subsidies. Find out if you are eligible for an ACA subsidy.
How do I choose a short term plan?
Once you’ve decided that temporary coverage is the right option for you, you’ll have to determine which specific plan to buy. When shopping around and comparing plans, here are some details to consider:
- Premium: This may be a monthly or annual rate. A lower monthly premium usually means a higher deductible. By choosing a policy with a lower premium, you’re banking on not having to use your insurance.
- Deductible: A lower deductible amount usually means a higher monthly premium payment.
- Out-of-pocket limits: This is the maximum you will have to pay out of pocket for the duration that the policy covers.
- Pre-existing condition coverage: What pre-existing conditions, limitation, and what amount of benefit will be provided, typically up to a maximum limit.
- Network requirements and participating providers: Are any discounts available for using certain healthcare providers?
- Company ratings: How is the insurance company rated, including a BBB rating and AM Best rating.
You can’t enroll in short-term medical coverage through an Obamacare exchange, so where can you find it? You can start by getting a quote on this website or calling 866-278-1464 to speak to a certified agent today.
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