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What are the Benefits of Short Term Health Insurance? What are the Drawbacks?

medicine covered by short term health insurance

Have you ever had a medical emergency without coverage? The benefits of short term health insurance outweigh the bad. Without short-term health insurance, you have to pay out of pocket, which is more expensive than you can manage. 

If you’re facing this problem, you may want to consider short-term policies. Doing so will help you to bridge the gap until you receive long-term coverage. 

More importantly, it will help you cover the costs of

  • Preventative medicine
  • Immediate treatments 
  • Unexpected illness or injury
  • Emergency assistance 

If you’re wondering whether this is for you, learning the benefits of short term health insurance (and drawbacks) will bring you some clarity. 

short term health insurance policy

The Benefits of Short-Term Health Insurance

Since there are many forms of health insurance, it may be challenging to narrow down what plans work best for you. Due to the benefits of short-term insurance, this type of healthcare plan is becoming more popular. 

Short term policies cover you for smaller time periods, but are more cost-effective compared to other plans. 

Flexible Plans

One of the many benefits of short-term health insurance is their flexibility. For example, these plans can provide coverage from as little as 30 days to 36 months, which comes with the option of a one-time renewal. 

For those who need a renewal or extension, you will experience less stress, especially if you require frequent doctors visits and emergency care to keep your health in check. The advantage of renewal is that there’s a good chance your coverage will be accepted on the same day. For the most part, this is unheard with traditional insurance!

Less Expensive

Short-term health insurance is cheaper than traditional policies because they offer a limited range of services than long-term plans. In addition, they provide temporary financial protection during lapses in coverage (i.e., such as waiting on your insurer to approve a long-term application).  

Covers Between Gaps In Enrollment & Employment

When you miss the general enrollment period (GEP) and don’t qualify for special enrollment, short-term insurance will cover you. Also, they will provide coverage when your job status is in question. 

For example, if you’re laid off from work, in between jobs, a temporary/seasonal employee, on strike, lost your job, self-employed, or waiting for a new position to start, these plans will benefit you. They are also ideal for recent college graduates no longer covered under their parent’s plan. 

National PPO Network

Many standard plans require referrals from a primary care physician. However, paying for short-term insurance provides you with a PPO network so you can refer to any specialist without a referral.

Low Premium Model

Normally, the cost of short-term healthcare varies based on the plan you purchase. However, they function on a low-premium model, which means that each plan has low monthly payments. With this model, you can pick your deductible; they can either be coinsurance or copays, given your preference. 

Depending on the plan, the out-of-pocket costs may be higher if you see doctors outside of your network. Typically, short-term plans have PPO networks, giving you access to all doctors and specialists within that circle. You can avoid additional fees by finding a physician within that network.

No Tax Penalty Payments

The Affordable Care Act (ACA) requires all Americans to have health insurance or pay a tax penalty. So, individuals who have endured hardship, been incarcerated, or are members of a religious group, are exempt from this act. In this case, short-term insurance may be for you, since it will provide you with a sense of safety in case of a medical emergency. 

Custom Coverage 

If you speak to an agent, they will help you to create a custom plan tailored to your specific needs. Compared to traditional insurance that lacks flexibility, short-term insurance provides you with the most options.

Drawbacks of Short-Term Healthcare

Although short-term healthcare covers urgent care, regular doctor’s visits, and trips to the emergency room, there are some limitations you should be aware of before beginning the application process. 

No Maternity Benefits 

If you are pregnant, short-term policies may not be ideal. For example, if you are at high risk for complications or require special procedures/ treatments to ensure a safe pregnancy, you may want to consider traditional health insurance. 

In addition, short-term plans will not cover newborn care, before/after birth assistance, breastfeeding care, and any crises that may arise postnatally. 

Lacks “Essential Coverage”

For all typical insurance policies, the Affordable Care Act (ACA) requires ten essential benefits to be provided to patients. 

According to the ACA these benefits must include: 

  • Hospitalization
  • Emergency services,
  • Lab tests
  • Outpatient care
  • Mental health 
  • Substance abuse services
  • Prescription drugs
  • Preventive care
  • Wellness services
  • Management of chronic diseases
  • Rehabilitation and habilitation
  • Maternity and newborn care
  • Pediatric services Including dental and vision

Although short-term insurance is great for managing urgent and emergency treatment, it does exclude many of those elements. Specifically, short term plans lack vision, dental, and hearing.

No Prescription Drug Coverage

The downside to short-term health insurance is that it does not offer payment for prescription medications. So, if you are an individual that requires daily expensive meds like insulin, you’re best suited for Medicare where you can add on a part D that covers prescription costs.

Doesn’t Cover Pre-existing Conditions

If you battle chronic issues such as back pain, diabetes, or cancer, short-term health insurance plans you will not be eligible to apply. Those conditions must be managed on a long-term basis, which is not conducive to short-term coverage. 

Instead, they act as a bridge between employment, which also supports your emergency costs. 

Excludes Substance Use & Mental Health

For those individuals who require substance abuse rehabilitation or mental health treatment, you’re better off having traditional insurance. Short-term plans are not designed to cover all the essential benefits required by the ACA. 

If you do need this kind of assistance and struggle with chronic issues, regular HMOs may be your best bet.

Must Pay Monthly Deductible or Coinsurance

Although the premiums are low, they may have a higher deductible. With this, you are required to pay your percentage before any services are provided. 

For example, if the coinsurance amount is 30% of $600 total, you must pay your portion before the insurance covers the remaining 70%. Keep in mind, these percentages will vary depending on your plan. 

Experience The Relief Of Short-Term Health Insurance!

Instead of roughing it with no coverage, there is a better option—short-term healthcare. Gone are the days of having to pay emergency visits out-of-pocket or panicking because you’re no longer on your parents’ medical insurance. 

Now, you can live without the stress of missing the general enrollment period. If you are looking for information regarding the benefits of short term insurance, we have the answers you need. 

More importantly, we will consider your best interests and create custom plans to cater to your unique needs. We keep it simple, reliable, and direct, providing you with the best advice possible. 

To speak to our well-informed experts, fill out a contact form at My Healthcare Direct or call us at (888)-959-1028!

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