When is short-term health insurance a good idea?

Your health is too important not to have the protection health insurance can provide. Ideally, if you work, you have an employer-based health insurance plan. However, what happens if you are in-between jobs, you aren’t eligible to keep your coverage through a COBRA plan, you are between enrollment periods, or if you can’t afford a plan with the health insurance marketplace? Medical care is expensive and most people can’t afford to pay for it without a health insurance plan. If you find yourself in this situation, don’t lose hope, you still have options. One of these options you might want to consider is short-term health insurance.

Federal regulations

The federal government has passed regulations expanding the availability of short-term health insurance and extending the length of time you can be covered by a short-term health insurance plan. You can expect a short-term health insurance plan to cover you for less than 12 months; however, you may be able to extend that period of time to 36 months in certain circumstances.

Short-term health insurance coverage

Short-term health insurance is meant to pay for basic medical care. The coverage options will vary based on which plan you buy and which insurance provider you use. One thing to keep in mind, short-term health insurance plans are not required to comply to the same strict standards of care as Affordable Care Act (ACA) health insurance plans. You can expect your short-term health insurance to cover physician visits, emergency care and a limited amount of preventive health care. Some even cover prescriptions.

Eligibility

Not everyone can qualify for short-term health insurance. You may not be eligible for coverage if you have pre-existing health conditions and you may have to answer medical questions before you are approved for coverage. Some insurance companies will disqualify you if you have certain medical conditions such as HIV, AIDS, cancer, heart disease or if you are pregnant.

Final thoughts

Short-term health insurance is meant to fill in the gaps in coverage when you are in-between jobs, can’t qualify for a COBRA plan to keep your employer-based insurance, between enrollment plans, or if you can’t afford health insurance on the ACA marketplace. It allows you to have coverage until you qualify for a more traditional health insurance plan. Short-term health insurance may be more expensive than a traditional health insurance plan and it also may not provide as much coverage. However, it does cover basic health care needs, which is better than having no insurance at all.