There may be times when you’ll consider a Short-Term health insurance plan so it’s important to understand their purpose - what they provide, and their drawbacks. Here are some of the things to keep in mind when it comes to Short-Term health insurance.
Short-term health insurance plans are intended to be short term solutions for during GAPS in your regular healthcare coverage. For example, many of us get our health insurance for through an employer or, if we’re over 65, through Medicare. Lapses in healthcare coverage may occur for various reasons. These can include:
· Being between jobs
· Retired from work, but not yet eligible for Medicare
· Having one spouse on Medicare, and a “trailing” spouse who is not yet eligible for Medicare
· Opting out of OBAMACARE or Affordable Care Act plans because of their relatively high premium costs for those of us who don’t qualify for a premium subsidy. (The cancellation of the ACA Individual Mandate removed the tax penalty for not having health insurance. As a result, those who don’t qualify for a subsidy may opt out without a tax penalty.)
It’s important to remember Short-Term health insurance plans are intended to be temporary solutions. While these health insurance plans are affordable and can provide between 6 months to 3 years of continuous care (depending on which state you live in) be aware the coverage they provide is not as comprehensive as major medical health insurance. Frequent changes in political policy, means today’s health insurers are continually developing new plan options to address the needs of people seeking health insurance outside of Affordable Care Act/Obamacare plans. Now perhaps more than ever, it’s important to work with a broker who is up-to-date on new plan options and alternatives.
Some of the drawbacks of Short-Term health insurance:
· Short-Term health insurance plans set limits on how much money will go toward medical bills for each term and they apply a lifetime cap. If you reach that cap, your coverage will terminate.
· If you exceed the lifetime cap not only will you no longer be eligible for coverage, you’ll also likely have a pre-existing condition. At that point, it’s unlikely you’ll be able to qualify for a new plan even if you opted for another carrier. Losing this type of coverage won’t qualify you for a SEP (Special Election Period) to opt in to Obamacare
· Short-term health plans are fully underwritten so if you have pre-existing conditions, they can deny you coverage.
· If you develop a health condition during your first term of coverage under a Short-Term health insurance plan, that condition could render you uninsurable and therefore unable to renew for an additional term depending on which carrier’s Short Term plan you initially enrolled in.
When to get short-term health insurance – and when not to
Short-term health insurance can be an affordable option to provide temporary coverage solutions under the right conditions. However, it is not intended to replace a comprehensive major medical plan. Short Term plans are best for those who are currently healthy & likely to remain so. Inexperienced brokers may recommend Short-Term health insurance policies as a viable alternative to more comprehensive major medical plans because they don’t truly understand the differences in coverage. Always working with an insurance agent who takes the time to educate you on the pros and cons of different plans so that you’re fully informed and well-equipped to make the best decision for your particular situation. If you need assistance choosing a health insurance plan, please call or text Joanne of Insurance Solutions Plus at 314-518-8266 or send a message here.