What is Short Term Insurance and What Are the Benefits?

What is short term insurance? We explain what short term health insurance is and how it can be beneficial for you.

You need insurance, but you can’t get a plan through the health insurance marketplace. What are you going to do?

A great option is to apply for short term insurance. This may be something to help you until you can get back on a traditional ACA plan.

What is short term insurance? How can it help? Who might be able to qualify?

If you’re interested in getting a non-traditional health insurance plan, keep reading to learn about short term health insurance plans.

What is Short Term Insurance?

Short term health insurance is a type of coverage that you can get for accidents and illness, but only for a specific period of time. People with this plan have lower monthly premiums than other major types of health insurance.

There are four main advantages to having short term health insurance.

1. You can use this type of insurance to pay for services at any doctor or hospital that is willing to provide services. This means you don’t have to change your doctor if you don’t want to.

2. Short term health insurance plans don’t have restrictions for enrollment like traditional insurance plans do, so you are able to apply at any time of year. You find out within just a few minutes if you are approved and can use your coverage much faster.

3. You don’t have to pay for the benefits that you know you won’t use. You get to personalize the plan you have to be more well-suited to your own needs, which makes it cost less in the long run. 

4. Financially, you will be protected in case something bad happens, such as an accident or a sudden medical problem. Short term insurance is meant to be this sort of protection until you are able to get regular insurance through the marketplace.

It is a good idea to learn about short term health insurance before you consider it and understand how it works as an insurance plan. Short term insurance has a lot of benefits to it and can easily be compared to the more traditional health care plans that are out there.

Choosing a Short Term Plan for Insurance

One of the reasons that people often choose to apply for this type of insurance is that they need to fill a gap in their coverage.

You may have lost your job, are waiting for your insurance to kick in from a new job, need to see a different practitioner, or are unable to afford other insurance options. 

These insurance plans are designed for people that don’t currently have a lot of medical issues and just want to have something to tide them over until they can get back on a marketplace or private insurance plan. It can be helpful to have this type of coverage when you need it!

The truth is that a lot of Americans are unable to afford health insurance, so short term plans are easier to afford because they have lower monthly costs and you still can see the providers you want.

Flexibility Options

The Affordable Care Act requires that insurance plans on the marketplace have to include 10 essential health benefits. Even maternity services are covered, which is great for expectant mothers!

If you don’t need all of the benefits that these plans have, you don’t have to have them with a short term health plan. They generally are more streamlined and will have less packaged benefits, which can be good or bad depending on what you need.

A short term health plan can be customized to meet your own personal needs. You select the plan deductible and the policy length that meets your needs. You may be able to find a plan that covers mental health, prescription medication, and/or preventative care.

Most short term health plans are like temp health insurance, meaning they only cover accidents or emergencies for a temporary period. When you want something to have just in case something goes wrong, short term health insurance is the best option.

The best part, however, is that you don’t have to pay extra for all of the benefits that you aren’t using. This is why a short term insurance plan can be great for people that don’t have a lot of health problems.

Apply at Any Time

The open enrollment period for ACA health insurance is generally at the end of the year. If you miss this time period, you likely will lose out on this option.

When you miss the deadlines, you only can enroll if you qualify for a special enrollment period. This is for life events, such as getting married, moving, or losing health insurance through your employer.

If you lose your job, for example, you lose your health insurance at the same time. What if you want to apply during your special enrollment period, but are no longer able to afford it because you no longer have an income?

What are you supposed to do then? Short term insurance can be an option because it costs less and is always available. That’s the beauty of it! 

Short term health insurance is something you can get when you need it rather during a specific time of the year. You may even get coverage that starts the very next day, which does not happen with traditional insurance.

Who Qualifies for This Type of Insurance?

Most people are able to qualify for this insurance plan, but not all of them. It is important to note that certain conditions will not qualify.

If you have a chronic condition, poor health, or complicated medical needs, you likely need the extra benefits provided by a marketplace or private insurance plan. In most cases, you would not qualify for a short term plan if you have these types of needs because it would cost too much compared to what you would pay.

In addition, if you’ve had a serious health event or some type of medical condition within the past 5 years, you will struggle to find a short term insurance plan that is going to accept you. This is because you likely will need extra coverage that is not generally provided under this plan. 

You should qualify for short term health insurance if:

  • You missed the enrollment period for ACA insurance plans
  • You are waiting before you can enroll in another insurance plan
  • You are between work and don’t have access to insurance this way
  • You are retired, but not eligible for Medicare
  • You cannot afford ACA insurance plans
  • You are a student or a recent graduate

Remember that not everyone who applies is going to be approved for a plan. This means that you might be rejected, even though you are within the flexible time schedule to apply.

It comes down to your medical background and personal health needs.

Are There Any Cons to a Short Term Health Insurance Plan?

As with any type of health insurance, there are limitations to what you can do or get with this type of plan.

Typically, you will have a limit on how many doctor visits you can have during your plan. This will generally be around two to three visits per your insurance period.

There are also limits on the benefits that you have. An example of this is that you may only have coverage of $1,000 per day within the hospital. After this amount, you would have to pay the rest on your own.

Another limit is that some of the plans will not cover prescriptions or mental health care. Some of the short term policies might offer you a drug discount card, but you will still have to pay for the prescriptions you have. This price is not always covered by these plans.

Lastly, as mentioned previously, you won’t have all of the benefits that you might with a marketplace health insurance plan. You won’t get maternity care, substance use treatment, or other benefits that you may need. If these are things that you think your family does need to have covered, it is important to consider this before applying for a short term plan.

Even with the limitations, short term health insurance options are great for people in certain situations. It is a good idea to do extra research if you are uncertain about this type of health insurance coverage.

Want to Apply?

You may feel ready to apply for short term insurance right now. 

What is short term insurance? It’s an option for people that need health insurance, but don’t have the ability to get other types of health insurance right now.

It’s a great option for filling gaps between insurance just in case something happens. You never know! If you’d like to learn some tips to keep your home healthy and make your body healthier at the same time, check out our blog post. You can avoid a lot of unnecessary medical costs by taking care of yourself.

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