Short-term health plans vary widely in terms of premiums, benefits, and deductibles. That’s why it’s crucial to do your research. There are so many questions to ask when buying short-term health insurance.
How much will it cost? What does it cover? And how long will it last?
Keep reading to learn what to ask, what you need to know, and whether a short-term medical plan makes sense for you.
What You Need to Know Before Buying Short-Term Health Insurance
Short-term health insurance used to be considered a temporary solution for health insurance because plans were limited to three-month terms. However, new federal regulations permit short-term policies to cover a person for up to three years. That, and the fact that there is no longer an individual mandate penalty for not having health insurance in most states, has made short-term health insurance an appealing option for people in the market for affordable, flexible coverage.
There are two big advantages of short-term health insurance: flexibility and affordability.
You can apply for short-term health insurance at any time because there is no enrollment period, and you can get covered as soon as the next day.* Short-term health insurance can be more affordable than major medical health insurance because it doesn’t provide as much coverage as Affordable Care Act-compliant plans (more on that below). However, it can still offer the benefits you need.
Questions to Ask When Buying Short-Term Health Insurance
So, how do you know if a short-term plan is a viable option for you? Here are 10 questions to ask when buying short-term health insurance:
1. Is short-term health insurance right for me?
Short-term medical insurance can be a good option if you don’t need coverage for any pre-existing conditions, are not pregnant or planning a family, and do not need mental health services. Given its temporary nature, it may be a nice option if you lose employer-based health care, are between jobs, or age out of your parent’s plan.
But short-term health insurance is not a good fit for everyone. For example, if you use health services often, have a pre-existing condition, or plan to start a family, you may benefit from choosing an ACA-compliant major medical plan.
2. What does short-term health insurance cover?
Federal regulations allow short-term health insurance providers to design their own plans, so coverages vary widely. A short-term health insurance plan through Vera Health typically includes access to the Aetna Open Choice® PPO network and benefits for the following:
- Doctor visits
- Urgent care
- Ground ambulance trips
- Emergency room care
- Home health care
- Child immunizations
- Physical therapy
- Diagnostic testing
- Emergency surgery
- Prescription drugs, in some states
The limited benefits of short-term coverage make it an affordable option for many people who don’t need all of the coverage from an ACA-compliant plan. Still, it’s important to understand your plan’s exclusions, so you’re not caught off guard. If you can’t figure out whether a service is covered in your prospective policy, contact a health insurance agent or the insurance company. You can learn more about what short-term health insurance covers here.
3. Does short-term health insurance cover pre-existing conditions?
Short-term health insurance doesn’t include coverage for pre-existing conditions and, therefore, does not comply with the ACA. Short-term health insurance carriers are able to keep their premiums low by limiting the conditions they cover and the benefits they provide.
The short-term health insurance application process includes a series of medical questions to determine an applicant’s eligibility. There is a chance you could be denied coverage, depending on your medical history.
If you have a pre-existing condition, short-term health insurance may not be a good fit. Instead, consider an ACA major medical plan, which cannot deny coverage to anyone based on their medical needs. It’s generally more expensive than short-term health insurance, but if you need coverage for pre-existing conditions, you’ll likely pay less for a major medical plan than you would for out-of-pocket medical expenses.
Read more about short-term health insurance and pre-existing conditions.
4. How long does short-term health insurance last?
Short-term coverage can last up to one year with the option to renew coverage for up to two additional years, depending on the state.
Traditionally, short-term health insurance has been a temporary option meant to help those without major medical coverage pay for unexpected health emergencies. Plans were limited to just three months until recently.
Now that you can have short-term health insurance for up to a year and there is no individual mandate penalty in most states, short-term health plans offer affordable, flexible options to help you meet your coverage needs.
5. What is a short-term health insurance plan’s cancellation policy?
Another great question to ask when buying health insurance is how your prospective provider handles cancellations, especially as it pertains to refunds. You can drop your short-term health coverage at any time, but you might not get a refund.
During the short-term health insurance application process, you usually have the option to pay for your coverage upfront or month to month. If you pay monthly, you can easily cancel your plan at any time.
Knowing the terms and conditions of your short-term health insurance policy before you buy it can help you avoid future confusion and frustration.
6. When can I apply for short-term health insurance?
You can apply for short-term health insurance at any time. There is no open enrollment period like there is for the Health Insurance Marketplace. Plus, some benefits can kick in the very next day.*
7. Can I still see my current health care provider?
If you have a doctor you want to keep seeing, make sure they’re on the list of approved providers before you buy a policy. You’ll want to get familiar with the network requirements for any health insurance plan you’re about to purchase, whether it’s a short-term or major medical plan. Short-term health insurance usually offers access to a wide range of health care providers, but it’s still smart to read up on your policy’s specifics if you want to keep your doctor.
8. How much does short-term health insurance cost?
Short-term health insurance premiums vary based on your ZIP code, age, tobacco use, medical history, and other factors. Vera Health offers short-term health plans that start at $53.**
Generally speaking, the higher the deductible, the lower the premium, and the lower the deductible, the higher the premium. Short-term health insurance tends to be more affordable than comprehensive major medical plans because it covers less.
9. What other health care expenses can I expect?
Your health insurance premium isn’t the only expense to consider if you’re shopping for health insurance. In addition to a monthly premium, there are deductibles, copayments, coinsurance, and out-of-pocket costs associated with health insurance. Additionally, some short-term health insurance plans do not include coverage for preventive care, such as physicals and vaccinations, or dental and vision benefits.
10. Does short-term health insurance provide minimum essential coverage?
Short-term health insurance does not provide the minimum essential coverage required by the ACA. Up until 2019, taxpayers faced an individual mandate penalty if they could afford health insurance but chose not to buy it and went uninsured for three or more months. Now, there is no federal penalty for not maintaining minimum essential coverage.
However, depending on where you live, you may be legally required to have qualifying health insurance and could face a tax penalty if you don’t. California, Massachusetts, New Jersey, Rhode Island, Vermont, and Washington, D.C. all have tax penalties.
There is certainly no shortage of health insurance coverage options out there, and as nice as it is to find a policy that truly meets your needs, narrowing down your choices can feel overwhelming. Asking the right questions, however, can help you find the short-term health plan that makes sense for you. To learn more about your coverage options, talk to a Vera Health expert by calling 888-499-1187, or visit us online.
*Covered services may be subject to waiting periods, visit limitations, deductible, coinsurance, or copays, and/or benefit maximums depending on the plan you purchase.
**Data based on demographic of a 24-year-old, single man who lives in Florida (ZIP code 32303).
Short Term Medical coverage is not required to comply with federal market requirements for health insurance, principally those contained in the Affordable Care Act. Be sure to check your policy carefully to make sure you are aware of any exclusions or limitations regarding coverage of pre-existing conditions or health benefits (such as hospitalization, emergency service, maternity care, preventive care, prescription drugs, and mental health and substance use disorder services). If this coverage expires or you lose eligibility for this coverage, you might have to wait until an open enrollment period to get other health insurance coverage.