What is Short Term Health Insurance?
How Does It Work?
What is Short Term Health Insurance?
Short term health insurance definition
– Short-term health insurance also known as “Term Insurance” refers to a health insurance policy with a specified and limited time period, usually from a few months to a year. Health insurance for short term periods are aimed to benefit people who need to bridge the gap between longer term policies with a temporary one.
Short-term health insurance coverage is usually less costly than traditional longer term insurance, however they do not cover pre-existing conditions. For people who acquire a longer term illness, this may be an issue as coverage for the acquired illness will terminate at the conclusion of the coverage period. With that being said, for the majority of people without pre-existing conditions, a term health insurance may be the best solution.
Since 2010, term health insurance coverage was not considered to be “adequate” under the Affordable Care Act making customers liable to tax penalties of being uninsured. The good news is that this tax penalty was eliminated under Congressional Tax Reform Act beginning in 2019.
Additionally, where there was a 3-month term limit on these types of policies, this has now been extended to up to 365 days in most states, eliminating the previous term limitation.
What Does It Cover?
What does short term health insurance cover?
– Short term health insurance benefits essentially include hospital care, doctor visits, x-ray services, and treatments in case of an accident or illness. While some term insurance policies do not provide drug coverage, some newer term policies do offer prescription drug coverage for generic drugs not tied to a pre-existing condition.
Short term health insurance is used for a variety of situations, however it is not intended for everyone. Term insurance is intended to be a cheaper option for those who don’t have certain serious health conditions, or require complex medical attention. Additionally, short term insurance can be applied for all year round, benefiting those who may have missed the Open Enrollment period deadline as is in the case of Obamacare.
Finding and applying for cheap short term health insurance is quite simple. It takes no more than a couple minutes to answer a few general questions to begin getting coverage pretty much immediately.
Why Would I Need Short Term Coverage?
There are many examples of where immediate short term health insurance may make sense for you to purchase. Here are a few to consider:
You Need Cheap, Temporary Insurance
When life’s circumstances leave you without standard insurance coverage, a long term policy may be quite expensive. Term insurance will not typically provide coverage for pre-existing conditions, but they do cover the kinds of medical bills encountered by unexpected injuries, illness, or hospitalization. Health insurance for short term periods provides financial protection from the unknown at a low monthly cost.
You are Hunting For a New Job
Searching for a job is stressful enough. The threat of needing medical treatment and dealing with the bills associated can compound that stress immensely. The low monthly costs associated with a term policy is a small price to pay in the short run to safeguard you and your family from the unexpected.
You are Waiting for Employer Coverage
New jobs typically have waiting periods that can take as long as 90 days until employer health coverage begins. Yes, sometimes these periods may only last only a few weeks, but why risk going uninsured? With the cost of most short term insurance policies being so minimal coupled with the financial protection they provide, there is no need to put yourself at risk.
You Missed Open Enrollment
Missing the Obamacare Open Enrollment deadline and not qualifying for a special enrollment period is a valid reason to consider purchasing short term insurance. Put simply, short term health coverage can provide the peace of mind you need from unexpected medical expenses. The idea is that you’re better off bridging the gap until you’re able to secure major medical insurance.
You Retired and Don’t Qualify for Medicare
If there is a short period of time between your retirement start date and being eligible for Medicare, you should definitely consider short term coverage. Paying for major health care expenses out of your retirement account is surely not the way to go. It is important to note however, that health insurance for short term coverage may not be a suitable option for those with pre-existing conditions.
Some More Questions to Consider
Is short term health insurance a good idea? Here are a few more questions to consider before purchasing a policy.
What are the pros and cons to short term health insurance?
The pros and cons of short term health care insurance will vary from person to person. It’s important to understand the entirety of what these policies have to offer as well as their limitations. Term insurance is not meant to be a long-term coverage solution, yet they do provide benefits that may be advantageous at a much lesser cost in comparison to traditional long-term policies.
Do short term health insurance plans cover pre-existing conditions?
Short term coverage does not typically provide protection against pre-existing conditions. When comparing short term health insurance vs. ACA health plans, short term coverage can be denied due to your current condition or health history, which is not the case with an ACA policy. More importantly, if you make a claim during your coverage period, that said claim may end up increasing your premiums on a renewed policy period. Furthermore, the claim may be categorized as a pre-existing condition and end up being excluded on your next coverage period altogether.
How much does short term health insurance cost?
Costs will vary depending on individual insurance providers. Generally speaking, when comparing short-term health insurance vs. regular health insurance, short term insurance is much less costly. The best way to find out exact pricing is to simply get a quote from one of our affiliate providers. Click the link in the upper right corner to get a quote now.
How do you buy a short-term health insurance plan?
There are several providers of term health insurance, and eTermHealth.com is here to help you simplify that search. By answering a few short questions, you can start reviewing quotes for short term, low cost insurance in no time. Due to the ease of applying and purchasing a short term policy, you and your loved ones can be insured as quickly as the next day. Once your payment and application have been accepted, you’re covered!