Recently, the market for short-term health insurance has blossomed. The reasons here are two-fold:
- Temporary health insurance plans provide an answer for consumers seeking an insurance product to bridge particular coverage gaps.
- The current administration also put in place new rules to open up a wider market for this type of short-term medical insurance.
However, temporary health insurance isnt right for everyone or every situation, and there are a few key elements to understand before you purchase this kind of short-term coverage.
What is temporary health insurance and how does it work?
Temporary, or short-term medical insurance, as the name suggests, provides policyholders with limited medical coverage for a specific window of time. Most policies support medical insurance coverage for 30 to 180 days, with more specialized plans including coverage for up to 364 days before requiring renewal.
Compared to regular health insurance, a temporary health insurance policy provides only essential health benefits, and includes certain limitations regarding coverage. In addition to lasting only one month or up to a year, short-term medical insurance typically has a coverage amount maximum of $2 million, along with other exclusions or limitations for covered health services.
Who should consider temporary health insurance?
Despite the limitations, short-term health plans are advantageous for individuals seeking the minimum essential coverage for a prescribed period of time.
- Regular insurance has lapsed: Whether this is due to someone transitioning from one employer to another or because they were laid off, essential coverage is still required in the United States. Short-term medical plans can ensure that individuals can still get the essential health benefits they need, even if they dont have access to a traditional employer-sponsored plan.
- Dependents or students: Once young adults reach the age of 26, they are no longer eligible for coverage under their parents or guardians insurance plans. In addition, students, including those in optional practice training (OTP) programs, may find themselves without coverage after their student policy ends. Temporary health insurance plans are an ideal solution for this transitional phase.
- Ahead of Medicare: Older individuals who retire from employment before their Medicare benefits begin can rely on short-term medical insurance.
- New to the U.S.: Individuals who recently immigrated to the U.S. are required to comply with insurance guidelines. Temporary health insurance plans can offer the limited coverage they need as they wait for a government-mandated health plan to begin.
- Missed the open enrollment period: A temporary health insurance plan is also a perfect option for those who may have missed the open enrollment period for long-term insurance.
Other instancessuch as a U.S. citizen returning from living abroad, a temporary or seasonal employee without regular insurance, or those recently divorcedmay also provide an opportunity for short-term health insurance coverage. While some consumers may consider a temporary health insurance plan for travel, there are more appropriate options, including visitors medical insurance, or international travel insurance.
What to know about choosing short-term health insurance plans
A temporary health insurance plan is an ideal way to prevent any periods of being uninsured, and to support access to essential health services without incurring heavy financial burdens. That being stated, there are a few key things to consider before purchasing a policy:
- Coverage period: As noted, plans vary in their coverage periods, so its important to find a plan that suits your needs. If you foresee being without a regular policy for a longer period of time, consider a plan with 364 days (the maximum window) of coverage.
- Exclusions or limitations: In addition to a limited coverage amount, temporary plans may also have limitations regarding coverage for pre-existing conditions, maternity, preventive care, and other services. Plans typically have an age limitation of 64, and may not be available to residents in all states.
- Approval and renewal: Some plans include a nonrefundable application fee, and approval is not guaranteed. Similarly, while some policies can be renewed at the end of the coverage period, this is not guaranteed.
Individuals without insurance may find themselves paying for high medical bills out of their own pocket, or even paying tax penalties for failure to comply with insurance laws. A temporary health insurance plan can help prevent these issues while supporting essential health benefits.
Connect with us at VisitorsCoverage to find out more about the available medically underwritten plans offered for individuals and families today.