Getting Short Term Health Insurance For 2020; Including Short Term as an ObamaCare Alternative

For 2020 you can opt to get short term health insurance instead of a marketplace plan, however short term plans don’t offer all the benefits, rights, and protections of comprehensive health insurance.

Why Choose Short Term Insurance

Since the fee for not having coverage is reduced to $0 in most states for 2019 forward, and since short term has now been expanded in many states, holding a short term policy for a full year has been an option for some families since 2019.

The main benefit of short term coverage is its low costs, the main drawback is its barriers.

The gist of short term is this, if you are healthy and don’t qualify for cost assistance through Medicaid, CHIP, or the marketplace, then you may find the cost/benefit/risk to align with your needs.

Signing up for short term is as easy as contacting a health insurance broker (feel free to use the number at the top of the screen). That said, you may want to understand the pros and cons for shopping for short term in 2019, those can be found below.

Pros and Cons of Short-Term Health Insurance

Pros. Short-term health insurance has significant benefits.

  1. It is low cost.
  2. You can get it any time subject to insurance company acceptance. In other words, you don’t have to shop during open enrollment!
  3. It will give you protection against specific catastrophic illnesses or accidents up to the limit of the policy.
  4. It will provide you with insurance coverage for a set amount of time.

Cons. It also has significant negative aspects.

  1. Short-term insurance is not ACA compliant, so is not required to provide minimum essential coverage or essential health benefits.
  2. Losing a short term health plan does not qualify you for special enrollment in a marketplace plan. So if you lose it, you might not have other coverage options.
  3. It is a not a “guaranteed issue” policy so you may be rejected.
  4. It can exclude any pre-existing conditions.
  5. Since you only buy coverage for the term of the insurance contract, the company is not required to renew your plan even if you are in the middle of an expensive hospitalization or chemotherapy at the end of its term.
  6. If you lose your job and buy a short-term policy, you may not be eligible for COBRA insurance.
  7. If you are eligible for any guaranteed issue individual health plans, commonly referred to as HIPAA (Health Insurance Portability and Accountability Act) plans, purchasing a short-term medical insurance plan will prevent you from qualifying for those HIPPA plans.

Short-term health insurance is the only insurance option for people who want a catastrophic-like health coverage outside of open enrollment. You may need it if you are:

  • Between jobs
  • Waiting for employer group coverage to start
  • Waiting for Marketplace coverage to start
  • Traveling outside of your network area
  • A recent college graduate
  • A temporary or seasonal employee
  • A dependent no longer covered under parents plan
  • on strike, laid-off, or a terminating employee.

You should probably avoid short term coverage if:

  • You have any ongoing health issues.
  • If you might otherwise qualify for cost assistance.

TIP: Make sure to check out the network and benefit summary of the short term plan and make sure to understand the policy length. In short, take the time to understand your policy, reasons you can be dropped, etc and make sure it is worth the savings!