Pros and Cons of Short-Term Health Insurance Policies
Short-term health insurance policies usually serve those who need it temporarily, such as “recent college graduates, people between jobs and early retirees,” until they can get traditional health insurance policies (Insure.com 2018; Norris 2018). However, the changes to these policies by the Trump Administration may benefit those who need it longer (Norris 2018). These plans still contain flaws that still warrant the need to enroll into traditional health insurance policies.
Some people could benefit from short-term health insurance plans. Due to the changes to these plans, people may utilize them up to 364 days instead of three months (Norris 2018). They could even renew them “as long as the total duration of a single plan doesn’t exceed 36 months,” depending on the state and insurance company (Norris 2018). Although people might receive a penalty this year for not having a plan that follows the Affordable Care Act’s (ACA) rules, the penalty will not be in effect for 2019, “which will make it easier for healthy people to opt for a medically underwritten short-term plan instead of ACA-compliant coverage” (Norris 2018). Also, while beneficiaries under ACA-compliant health insurance policies must deal with rising premiums, short-term insurance policies can provide cheaper premiums and deductibles (Norris 2018). Furthermore, people can go through an expedited enrollment and eligibility process and do not have to wait long for the plans to activate (Norris 2018).
However, people may find that short-term insurance policies have their flaws. Some states, such as New York, Rhode Island, Vermont, etc., may not allow insurance companies to offer short-term plans to people (Norris 2018). Some states may impose other caveats on these plans, such as “capping their duration at something less than a year” (Norris 2018). Furthermore, according to Louise Norris, “an individual health insurance broker,” these policies “aren’t ACA-compliant, don’t have to cover various essential health benefits, can have lifetime and annual benefit limits, and their termination does not trigger a special enrollment period for ACA-compliant individual market plans” (2018). People may not have coverage for necessary services, such as “routine office visits,” maternity care, care for mental health, etc. (Norris 2018). In addition, these policies usually do not offer any benefits for their beneficiaries’ pre-existing medical conditions (Norris 2018). Though, people could try to find more expensive short-term policies that contains benefits for certain services, such as prescriptions and mental health care, and a higher lifetime benefit maximum (Insure.com 2018).
Due to the caveats of short-term policies, people should look past its pricing and research their terms and conditions before enrolling into them (Insure.com 2018). Short-term insurance policies is not a long-term solution for affordable health care. With the changes to these policies, they could still help people pay for it and use it for medical services for an extended period of time until they get a more comprehensive health plan (“Comparing Short-Term Health Insurance with Regular Health Insurance”).