Short Term Insurance still has a place.

Posted by Phil Dougherty
May 13, 2014

Our new health care reform law has made it possible now for virtually anyone to obtain health insurance. Those with a pre-existing condition(s) cannot be denied insurance, charged a higher premium or have coverage restricted in any way. This is a huge step forward in our health care system and the ramifications of this step are being played out as I write this message.

But there has been another significant change that was less publicized. There are only certain times of the year when you can enroll in or change coverage, called Open Enrollment. What! Did we fix one problem in our system just to create another?

There are a number of reasons Open Enrollment periods were created, not the least of which was to jump start our new health care system. If people could buy or cancel insurance as they please (or as their health pleases), you can imagine the next initiative — the ability to buy Home Owners insurance while your house is burning.  Open enrollment periods are a tool that compels policyholders to pay premiums when they are healthy, not just when they are sick. The next open enrollment period is slated for October 15 – December 7, 2014 when you can enroll in or change plans for the next plan year (January – December 2015).  A Special Enrollment period is available for those who have a qualified life event – see last month’s blog for details.

So, what about those who find themselves outside of an open enrollment period with no coverage?  It’s still possible. Sometimes it happens by choice when individual plan premiums are too expensive. Sometimes it’s because of forgetfulness; forgetting to enroll or to pay COBRA or individual plan premiums. Or it happens by circumstance; returning to the US from abroad or needing just a few months of coverage until a group plan starts.  And often it is a combination of these factors. We have assisted many people in these situations and we are delighted to have a solution to offer.   

Short Term Insurance has been around for decades and still has a place in our healthcare system. It provides a short-term benefit (6 months or less), for accidents or illnesses that occur during the covered period, and it offers a maximum benefit as high as $2,000,000.  Some short-term plans will even cover pre-existing conditions if there was prior insurance in place.  This is not ACA-compliant insurance and does not waive a potential penalty for not carrying it.  But it does provide purpose and peace of mind, and is certainly better than going without coverage.

The way I describe this short-term insurance to clients is “coverage you don’t intend to use, but know you may need”.  Hence, it doesn’t provide non-urgent services such as preventive care, immunizations and, in some plans, it excludes prescription medication. This insurance is for the accident that results in a turned ankle or a twisted knee, the stabbing pain of a ruptured appendix, or the heavy cough that becomes pneumonia. All of which result in costly medical treatment and care.   

So if you find yourself or someone you know without coverage (and who is outside of open enrollment without a qualified exception), consider purchasing Short Term insurance.  

We’ll be happy to tell you more about it and get you enrolled today.

Phil Dougherty