Getting Short Term Health Insurance Instead of ObamaCare
Short term health insurance can be used as primary coverage in some cases. This is especially true for those who are healthy and want to keep costs low.
Using Short Term Coverage As a Primary Insurance
Using short term as your primary coverage is basically like having catastrophic coverage as your primary insurance. Generally it would be a low premium insurance with high out-of-pocket costs and low premiums designed to protect you in emergencies (but not designed for routine care).
This is the sort of option a healthy young adult who doesn’t qualify for costa assistance and doesn’t have coverage through work might consider for example.
Short Term Coverage Under the Affordable Care Act
The important thing to understand is that short term health insurance doesn’t qualify for assistance and doesn’t cover all the benefits, rights, and protections offered by the Affordable Care Act.
However, as of 2019 there is no mandate to have coverage or pay a fee in most states, and short term plans have been expanded, thus some shoppers may find short term plans to be their most affordable option and a viable choice for primary coverage.
With that said, only a small subsection of Americans are likely to have this be the best choice for them. Let’s take a closer look at short term as a longer term insurance.
Pros and Cons of Short Term Health Insurance
The pros and cons of short term health insurance are straightforward. Short term plans typically offer low cost / limited benefit coverage compared to comprehensive major medical coverage in exchange for not having to follow the rules set forth by the Affordable Care Act (ObamaCare).
Here are some benefits of short term health insurance plans
- Low cost health insurance (if you are healthy)
- Approval as early as tomorrow
Here are some downsides of short term health insurance plans
- Doesn’t cover preexisting conditions
- Doesn’t count as minimum essential coverage (a type of major medical coverage that follows the rules of the Affordable Care Act).
- Doesn’t provide essential health benefits of ObamaCare
- Primarily acts as catastrophic coverage
- Limited selection of doctors
- You can’t get ObamaCare cost assistance with a short term health insurance plan
- Having this coverage may prevent you from getting COBRA or HIPPA
Is Short Term Health Insurance Right For Me?
The main considerations when shopping for a short term plan that will work as an alternative to major medical are:
- Can you get a 12 month contract? If not, then short term isn’t an option.
- Will you have reasonable out-of-pocket maximums? Short term plans don’t have to have the same cost sharing limits as major medical plans.
- Will you be able to see the providers you want? A short term plan may have a network that is too restrictive for you.
- Can you save more getting cost assistance on the marketplace? If you can, why go with short term?
- If you had to pay the full out of pocket costs in an emergency, would you be able to? If not, it may be worth it to you to consider a more robust plan.
How Do I Get a Short Term Health Insurance?
Short term plans aren’t bought through the health insurance marketplace HealthCare.Gov, instead you’ll buy them from a private broker outside of the marketplace.
Finding a broker for short term coverage: If you want a short term plan, you have many options for finding a broker. However, if you choose a marketplace approved broker (a private broker who is also qualified to enroll you in a marketplace plan), they will be able to show you both short term and marketplace plans (thus they will be qualified to show you a fuller range of options than just marketplace brokers or just non-qualified brokers)! If you choose a broker who isn’t qualified to sell you marketplace plans, then your options may be limited to short term only. If you want help finding a marketplace qualified broker, feel free to call the number at the top of the page. If you don’t want to use that method, you can just search online for local brokers, contact them, and ask them what plan choices they offer! If you know what you are looking for in terms of plan types, finding the right broker for you is just a matter of looking for the right match for you.
Bottom line on the question, “Should I get Short Term Coverage?” If you are healthy and don’t qualify for cost assistance, are in between plans, or if you missed open enrollment, then a short term plan may be the right choice for you. Likewise, if you are healthy, you might even consider short term as an alternative to major medical. However, if you would qualify for cost assistance, live in a state with a mandate to have coverage, or have to cover a family with ongoing medical needs, then you’ll almost certainly want to look at major medical plans during open enrollment instead.