Traditional health insurance plans (“major medical health insurance”) must help you pay for 10 essential health benefits guaranteed under the Affordable Care Act. Short-term health insurance, by contrast, isn’t required to do so.
However, there’s considerable variance among short-term plans. Some plans offer fairly robust coverage. Others do not. In addition, different states have different requirements about what benefits must be covered.
There’s also likely to be substantial changes coming to short-term health insurance. Currently, Federal legislation has been filed to increase and regulate the Short-Term Medical lifetime maximums.
If you’re considering a short-term health insurance plan, it would be wise to discuss your needs and options with an expert.
Temporary Health Insurance
Short-term health insurance (also “short-term medical” or “temporary health insurance”) can safely get you through a variety of temporary situations. However, short-term insurance isn’t designed to compete with major medical health insurance in providing coverage for ongoing medical issues.
Short term plans were sold prior to the ACA and proved a good fit for many people’s insurance needs. They’re cheaper than other forms of health insurance, although they provide fewer benefits compared with an Obamacare (Affordable Care Act) -approved health insurance plan.
Short-Term Health Insurance and Essential Health Benefits Coverage
Below, we’ve listed all 10 of the Affordable Care Act’s essential health benefits. We’ve also detailed whether or not short-term health insurance plans may or may not cover each of the benefits.
1. Chronic Disease Management, Preventive Care, and Wellness Services
The specific benefits vary per plan, but generally a longer-term equals wider coverage. Three-year plans, for example, tend to have more robust benefits, than three-month plans. Regardless, most short-term health insurance plans will offer you at least one doctor’s checkup at a low cost during your plan. The amount of your copayment, and whether or not a wellness visit will count toward your deductible, depends upon the rules of your chosen plan.
Chronic Disease Management
Short-term health plans generally won’t cover treatment for a pre-existing condition. But there are exceptions, particularly among the three-year plans. Plans differ by state and by carrier. Again, it’s important to speak with a professional before choosing a short-term plan.
2. Outpatient Care
Care from general practitioners and medical specialists is a staple of short-term health insurance plans. While doctor availability will be subject to your insurer’s rules, short-term plans typically have very large doctor networks.
But payments for doctors will vary by plan. Depending on the plan you choose, you may have a copayment for your doctor visits or a deductible and coinsurance up to your out-of-pocket maximum. The total monetary value of your benefits will be limited based on the plan you choose; plans are available with a $1,000,000 maximum.
Same-day surgery for a new medical condition will probably be covered, but there will likely be reasonable limits to the amount your plan will pay. You can discuss costs with your doctor in advance to work around any restrictions. Some of the most common medical conditions will probably have more specific coverage guidelines.
With any in-patient or out-patient surgery, it is important to call the insurance carrier to ensure you are using a hospital, doctor, lab, and anesthesiologist, radiologist, and pathologist that the carrier will pay for. In addition, it is important to inquire as to the amount of your out-of-pocket expenses for the procedure.
3. Emergency Services
You shouldn’t expect to be penalized for going out-of-network due to an urgent and serious health issue. Although there may be a cap on the amount your plan pays for an individual ER visit.
Medical transportation MAY be covered under your short-term insurance; it is important to check your schedule of benefits.
4. Inpatient Hospitalization
Short-term insurance is designed to let you get emergency hospital care without suffering from ruinous costs. Once you’re admitted to a hospital, your costs will generally be covered by your plan. There will likely be limits on the amount your plan pays for specific services.
You’ll also likely have a considerable copayment if you’re admitted to the hospital. However, the ultimate cost of your care will be limited to your plan’s out-of-pocket maximum.
5. Laboratory Services
You’ll be able to get referrals from medical professionals for laboratory services in the same manner as traditional health insurance. But benefits vary widely among plans. Check with your carrier to ensure that lab tests are covered by your plan.
6. Prescription Drugs
Most Short-Term Medical Plans include prescription drug coverage, or they offer a rider to include prescription drug coverage. Your provider may also give you the option to use a discount prescription service.
7. Mental Health and Substance Use Disorder Services
A limited amount of inpatient treatment will probably be covered by your health insurance plan. There may be limits on the amount your plan pays each day. If you are in inpatient treatment, your drug costs will most likely be covered.
Short-term insurance generally covers outpatient mental health treatment. Unlike Obamacare (ACA) plans, they do not have to be covered in a comparable manner to doctors. The coverage rules depend on your plan and would likely require a copayment and set a limit on the number of visits.
8. Rehabilitative or Habilitative Services and Devices
Coverage for rehabilitation varies widely depending on the plan you choose and the specific care you seek. Some rehabilitative specialists will be covered by your plan, particularly if it results from an injury sustained during the time you were on your plan.
Services that help with learning a new skill probably won’t be covered.
Durable medical equipment to help you heal or overcome a condition probably may or may not be covered by your plan. Basic devices given to you from a doctor or hospital, like a cane or resistance band, might be covered.
9. Maternity and Newborn Care
Maternity services are now covered under some Short-Term Medical plans and may have a separate deductible. Check with your provider.
Since short-term insurance plans generally exclude newborns from their policies – even when they insure other young children as part of a family plan. Your hospital will be able to direct you to specific assistance programs for newborn children.
10. Pediatric Services (Including Oral and Vision Care for Children)
You can purchase short-term health insurance to cover your entire family. Many companies also sell stand-alone dental and vision care plans. However, short-term medical plans don’t offer additional child-only benefits as Obamacare plans would.
There’s No More Obamacare Penalty
Starting in 2019, you’ll no longer have to pay the large “Obamacare tax penalty” for choosing health insurance that isn’t Obamacare. This may make short-term coverage a more compelling purchase for those who qualify.
Taking the Next Steps
Short-term health insurance plans may look similar to other forms of health insurance.
If you’re considering temporary health insurance, take a close look at your benefits and carefully weigh whether or not you expect to use them. Speak to an expert before making a purchase decision. And afterward, make sure you have your coverage details on hand in case you have to navigate emergency services.