- Posted by Canopy KC
- On August 18, 2017
- 0 Comments
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Short term health insurance falls somewhere between major medical coverage and no coverage at all. These plans are designed to be temporary coverage with limited benefits. So, why do people purchase short term insurance? Why are premiums so much cheaper? How are people denied with pre-existing conditions? All great questions; continue reading for a brief introduction to the basics of short term health insurance.
Short Term Health Insurance Explained
Commonly, short term health insurance is purchased by individuals or families in a transition period until a long term coverage plan can be found or enrolled in. Short term coverage is NOT a substitute for standard health care coverage or Affordable Care Act (ACA) coverage. It is also important to note that short term health insurance coverage does NOT meet the minimum criteria to avoid the ACA tax penalty, which you will still need to pay. While not ideal, there may be some special situations or circumstances that this type of coverage may be a good fit.
When short term insurance may be a good choice:
• Missed open enrollment
• College graduate ,older than 26, needing coverage prior to a job
• Gap coverage between jobs
• Gap coverage prior to Medicare coverage beginning
• If quick coverage is required for an international trip or other activity
As of April 2017, short term health insurance coverage can only be purchased for a three (3) month time period. Generally speaking, if you are still in need of temporary coverage after your policy expires, you can re-apply. An example would be if there are three (3) or more months until the next open enrollment period and you do not qualify for a special enrollment period.
Short Term Health Insurance Benefits
When short term health insurance makes sense, there are some benefits.
•Availability: Coverage can be begin as early as the next day following application.
•Duration: The maximum coverage period is three (3) months, but can be cancelled at any time without penalty.
•Cost: Premiums and co-pays tend to be less expensive in comparison to major medical coverage.
•Coverage applies to doctor or ER visits related to new or routine injuries or illnesses.
•Prescription medication coverage is mostly in the form of prescription discounts vs drug coverage.
Short Term Health Insurance Limitations
Short term health insurance coverage is intended to be temporary and is designed to provide limited coverage. Typically, short term insurance does not cover:
• Pre-existing conditions
• Pregnancy or standard maternity care
• Preventative Care including immunizations
• Mental health services (vary by state )
• Rehabilitative services
It is common knowledge that there will be health care changes in the coming months but at this time, some form of health insurance is available for everyone. If you are considering short term health insurance or have questions regarding a short term health insurance plan, call a professional at Canopy. We are here to help you with your long and short term insurance needs.