short-term health insurance can bridge a gap in coverage

Short-term health insurance can be used to bridge a temporary gap in coverage. But it is important to understand characteristics of short-term coverage before you buy it.

Now that the window of opportunity to purchase 2014 Affordable Care Act (ACA)-compliant health insurance has closed, many people are wondering how they can be protected in the event of an illness or injury this year.

In most cases, if you did not purchase a 2014 policy before the March 31 deadline, your option for the remainder of 2014 is to purchase what’s known as short-term insurance.  (*See notes below for some exceptions.)

What is Short-Term Health Insurance

Short-term health insurance (also known as temporary coverage) has been around for a long time.  These are policies typically geared toward recent college graduates, people who may be between jobs, new employees waiting for group coverage to kick in, or anyone else needing coverage for a defined window of time.  Just as the name suggests, the coverage is intended to be temporary, for the short term.

Characteristics of Short-Term Health Insurance

If you missed the March 31 deadline to buy a 2014 policy and you are currently uninsured, being covered under a short-term policy is better than having no coverage at all.  As you research your options, however, it is important to understand the characteristics of short-term insurance.

  • Short-term plans are not subject to the rules of the Affordable Care Act (ACA).  Therefore, they typically provide less coverage than ACA-compliant plans.  Since they do not meet ACA minimum essential coverage requirements they typically do not cover things like preventive care, immunizations, maternity care, allergies, etc.
  • Short-term coverage can be denied for anyone who is sick.
  • Pre-existing conditions are usually not covered by short-term policies.
  • A short-term policy does not have guaranteed renewal.  This means if you buy, for example, a 60-day plan, the carrier is not required to renew your coverage at the end of 60 days.  If you get sick during those 60 days, your request to renew can be denied.
  • If you get sick during your initial policy period and your carrier does permit you to renew, that sickness is now considered a pre-existing condition under your new policy.  Any treatment for that condition will be denied.
  • Since they do not meet minimum essential coverage requirements, short-term plans do not satisfy ACA’s individual mandate.  This means if you have a short-term policy, you may still be subjected to a tax penalty under ACA.

Should You Buy Short-Term Health Insurance?

If you are reading this during an open enrollment period for health insurance under the Affordable Care Act (Nov 15, 2014 – Jan 15, 2015 for 2015 coverage), we would steer you away from short-term coverage in favor of an ACA-compliant plan with more robust coverage.

However, if you are reading this outside of open enrollment and you are currently uninsured, then we recommend a short-term policy as your best option.  After all, if you get sick or are injured and you have no health insurance, the financial impact could be tremendous.  Short-term coverage is definitely better than no coverage at all.

How to Buy Short-Term Health Insurance

To research your options for short-term coverage, visit the links below or contact our office for assistance.  You can reach us by phone 1-800-867-0800 or email jkatz@vamedicalplans.com.

Remember, short-term coverage is better than none at all.  Get in touch with us today!

 

*If you were “in line” using the federal health insurance exchange (healthcare.gov) on or before March 31, you have until approximately April 15 to complete your application.

*If you experience a qualifying event — e.g., change in marital status, change in job status, certain changes in income, birth/death/adoption of a child — you can purchase an ACA-compliant policy during what is known as a special enrollment periodClick here to read more.

 

 

Open Door

2014 open enrollment may have ended for most people, but a qualifying event will open the door to a special enrollment period.

March 31 has come and gone.  And with it has come the end of open enrollment for 2014 health insurance plans.

Unless you had already begun an application on or before that date through healthcare.gov (the federal health insurance exchange used by Virginia residents), March 31 was the last day you could purchase non-group health insurance coverage during 2014 open enrollment.

However, there may still be an opportunity to purchase 2014 coverage during what is known as a special enrollment period.

Special Enrollment Period Triggered by a Qualifying Event

A special enrollment period is a window of time during which you can enroll in a health insurance plan outside the dates of open enrollment. A special enrollment period is triggered by certain qualifying events.

In most cases, the period lasts 60 days from the date of the qualifying event. However, in the case of the loss of a pre-Affordable Care Act policy due to non-renewal by the carrier, the special enrollment period lasts for 30 days.

Examples of Qualifying Events

  • Change in marital status (marriage/divorce/death of a spouse)
  • Relocation to a new state
  • Change in family size (birth/adoption/death of a child)
  • Loss of minimum essential health coverage (change in employment status, cancellation of current coverage)
  • Certain changes in income
  • Expiration of COBRA

If You Have a Qualifying Event

If you do have a qualifying event, you must have proof of the event.  When applying for coverage, you will need to submit verification of the event and the date it occurred. Without verification, most carriers will not process the application.

If you have a qualifying event and you are eligible for a subsidy (click here to find out), then you will need to purchase coverage on your state’s health insurance exchange (healthcare.gov for Virginia residents, marylandhealthconnection.com for Maryland residents, dchealthlink.com for DC residents). Click here for instructions.

If you are not eligible for a subsidy, you can apply directly with the carrier of your choice:

What if You Don’t Have a Qualifying Event?

Absent a qualifying event, most individuals will not be able to purchase Affordable Care Act (ACA)-compliant health insurance coverage for 2014 after March 31.  Instead, you will need to wait until next year’s open enrollment — Nov 15, 2014 to Jan 15, 2015 — to buy coverage effective in 2015.

If you are concerned about being uninsured for the remainder of 2014, you may have an option to purchase a temporary policy as a bridge through the end of the year.

Temporary plans offered outside of a special or open enrollment period will not be ACA-compliant.  One critical missing piece will be coverage for pre-existing conditions; they will not be covered.  But you would be covered for any new illness or injury that arises before 2015.  Although not ideal, a temporary plan is better than having no coverage at all.

Here are two companies we work with that offer short term, temporary coverage:

We Can Help

If you have a qualifying event, let us know right away so we can help you find new coverage that will best meet your needs.

Even without a qualifying event, if you do not have health insurance, give us a call.  We may be able to help you at least find a temporary policy to give you peace of mind until 2015.

Call us at 1-800-867-0800 or send us an email at jkatz@vamedicalplans.com.