Short-Term Health Insurance or Regular Coverage – How to Choose
Short-term health insurance policies are becoming very popular. More people are buying these policies to get immediate coverage. But is short-term health insurance or regular coverage the right choice for you? Does it make sense to go without coverage?
Find out more about the differences between these two health insurance policies by reading below. Learn who chooses short-term coverage and why. Every situation is a little different, but we can help you make the best decision.
Short-Term Health Insurance is a Bridge
Short-term health insurance is not a regular traditional policy. Usually, short-term policies offer maximum payouts and require medical underwriting. The term of most policies is three months, although they can be shorter or longer.
Some companies offer extended short-term coverage. Newer plans allow the insured to buy up to four 3 month term at once. This eliminates needing to prove insurability after one or more terms has expired. But this type of policy is not regular health coverage; plans will have annual maximums and they may not cover preexisting conditions. You should not expect these plans to cover a pregnancy or high cost prescriptions that you are already taking.
In most cases, short-term health insurance is a bridge that provides essential coverage until a person qualifies for regular health insurance. Many consumers, however, are opting for short term plans over ACA coverage simply due to cost. These plans can be tailored to meet most budgets and they’ll provide coverage for unexpected accident, injuries and illnesses.
Immediate Coverage
When a person needs immediate coverage, a short-term policy is a viable choice. Policies can be purchased today and in effect tomorrow. You can select the exact amount of days you would like to have coverage. And if your traditional coverage begins sooner than thought, you can cancel your short term plan an receive a refund for any unused days
Most short-term policies cover emergency hospital visits and basic medical costs. Others will offer office copays and prescription drug coverage. You can also add dental & vision coverage as well as cash reimbursement riders that will cover the deductible you select. Always review the terms of the policy with your insurance agent and ask questions about the extent of coverage.
Reduced Costs
One of the reasons people select short-term health insurance is reduced premiums. With less coverage and a choice of deductibles, the monthly premiums are very affordable. People who lost their job – or students waiting for other coverage to kick in – benefit from short-term health insurance coverage.
COBRA coverage is costly if you find yourself unemployed. But you may feel better with some amount of health insurance. The budget-conscious cost of short-term coverage offers an affordable cushion while looking for employment. And if you find a job, short-term coverage is in effect until your employer offers regular health insurance. Sometimes employers have a waiting period of one to three months.
When Short-Term Insurance Is Not an Option
Unlike regular health insurance coverage, short-term insurance does not have to observe the Affordable Care Act (ACA) requirements. These policies do not have to cover the ten health benefits ACA health plans must cover. Basically, short-term plans are meant to cover unexpected injuries and sudden illnesses. Pre-existing conditions may not be covered. For this reason, the premiums are less expensive than regular health insurance. But if a patient has a pre-existing coverage, this plan may not be practical.
Fill in the Gap
A person who has a job and needs to wait for coverage would benefit from a short-term health insurance plan. Or a student no longer covered under his or her parents’ policy fills in the gap with short-term coverage. Those who are in good health and just a few months away from Medicare eligibility enjoy the peace of mind these plans provide.
But it is not meant to be a permanent solution. In other words, there are few substitutes for regular health insurance. However, short-term plans prevent people from the financial stress of medical bills if they have an emergency before regular insurance starts.
What If I Need Regular Health Insurance?
People with specific health conditions might need regular health insurance coverage. Always consult with a reputable insurance agent to find out your options. For example, a pregnant woman cannot get coverage through a short-term policy. But the state may offer options under the ACA.
And there are a wide variety of regular health insurance coverage options to suit your needs and budget. Let a knowledgeable agent do the shopping for you to get the best possible coverage under the circumstances.
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Category: Health Insurance