Health insurance provides financial coverage for medical expenses. There are four main forms: employer or school sponsored plans, individual or private plans bought on the Marketplace, Medicaid and Medicare plans.
Short term health insurance provides quick coverage that often starts the day following approval, making it ideal for quickly filling gaps between major medical plans or jobs.
1. Short-term plans
Short-term plans are health insurance plans designed for short-term medical coverage or to fill gaps between other longer-term health plans. Since they do not fall under the purview of the Patient Protection and Affordable Care Act (PPACA) market rules – such as restrictions on preexisting condition premiums or the requirement that all plans cover 10 essential benefits – short-term policies tend to offer lower prices and shorter terms than their counterparts in individual health plans.
Since these policies do not fall under PPACA rules, it is crucial that you understand their limitations before purchasing one. For instance, some short-term plans contain cost-sharing provisions requiring you to pay a set amount each time you visit a doctor, which can quickly add up when used for routine health care or preventive services. Furthermore, many short-term policies do not cover or may only minimally cover things such as maternity care or mental or substance use disorders.
In 2018, the Trump administration modified federal rules regarding short-term plans. Under these new guidelines, initial duration for short-term plans can now range from 364 days and renewals up to three years; states may further regulate their duration.
If you’re seeking short-term coverage, your options include shopping the private marketplace or reaching out to an independent agent or broker. All types of health insurance brokers and agents must be licensed in their state of operation and depending on the plan or insurer, may require completion of an application form, medical underwriting questions and health screening in order to establish eligibility.
Short term health insurance plans typically only provide coverage for unexpected, serious medical issues; therefore, these policies are best utilized during situations in which you need to bridge an employer health insurance waiting period or transition between different forms of coverage. Many find immediate health insurance convenient as a means of meeting employer or school requirements for proof of coverage – an option accessible to nearly everyone.
2. Marketplace plans
If you don’t already have health coverage through an employer, shopping on the health insurance marketplace could be your solution. This platform promotes competition among private insurers while offering plans with tax credits and savings based on income.
The Affordable Care Act’s (ACA) Marketplace was designed to assist uninsured individuals and families purchase affordable health coverage. Individuals can apply online, over the phone, with paper applications or with assistance from local assisters; to locate one near them visit Find Local Help on How to Apply & Enroll page.
Under the Affordable Care Act (ACA), all marketplace plans provide essential benefits as outlined by the ACA, such as emergency room services, doctor and hospital charges, pregnancy, treatment of pre-existing conditions, mental health services such as substance abuse services and lab work as well as prescription coverage. Most plans also include dental and vision coverage with four “metal” levels available ranging from bronze being the least costly plan up to Platinum plans being the most expensive plans available in their respective market place.
Shop marketplace plans either through a state or federal health insurance exchange, a private website such as eHealth or anywhere else you prefer – cost and government subsidies will remain constant regardless of where you shop; however eHealth gives more options as it displays both on-exchange plans as well as off-exchange ones.
Most states offer an annual open enrollment period from November 1st to January 15th each year to enroll in marketplace coverage, though you can seek it outside this window should a qualifying life event arise, such as job loss, marriage or the birth of a child.
If you enroll in a marketplace plan, an accurate representation of your annual income is critical for maintaining coverage or paying back financial assistance received. To avoid this scenario, work with an experienced health insurance agent or broker who can help guide the application process and estimate your estimated annual income before filling out the necessary forms.
3. Medicaid
Medicaid is a joint federal-state program that offers health coverage to low-income families, pregnant women, children, adults with disabilities and elderly people living below certain income thresholds outlined by the ACA minimum essential coverage thresholds. States may expand eligibility beyond this minimum essential coverage threshold by including additional low-income groups like blindness or end stage renal disease sufferers in Medicaid eligibility calculations. Beneficiaries must fulfill specific criteria in order to be eligible for this coverage and may incur monthly premiums, deductibles and co-pays as part of the contract terms.
Individuals without access to employer-provided coverage can obtain health insurance by purchasing plans through either the Affordable Care Act marketplace or directly from insurers outside it. They have 60 days after experiencing a qualifying event to enroll or risk forfeiting any financial assistance they received; otherwise they will have to wait until open enrollment period II for enrollment opportunities.
As part of their efforts to make finding and enrolling in private plans easier, many states have expanded access to certified application counselors, market facilitation specialists, and navigators – such as New York State of Health’s in-person and online assistance options – that can assist individuals.
The COVID-19 Pandemic Illustrates the Importance of Medicaid as a Public Health Tool Congress has responded to its financial strain with temporary matching rate increases for Medicaid as well as by stopping states from disenrolling beneficiaries and making more affordable health care available to those who can’t afford it, providing affordable health care to those whose finances may otherwise crumble due to economic emergencies such as this pandemic.
Studies have demonstrated the positive outcomes of Medicaid expansion on access to health care, with beneficiaries more likely to visit a physician, receive regular checkups and preventive services, follow treatment plans for chronic conditions and avoid credit issues that might otherwise lead to home eviction.
4. Subsidies
The Affordable Care Act created premium tax credits, more commonly referred to as health insurance subsidies, to assist those with moderate to low incomes afford marketplace plans more easily. These subsidies are calculated based on an individual’s earnings compared to federal poverty level guidelines and number of household members in their home. A vast majority of exchange enrollees receive these subsidies which play a crucial role in making plans more affordable; payments made directly by health insurers to enrollees’ health plans on their behalf each month then reconciled during annual tax returns.
If you find an affordable marketplace plan, open enrollment periods usually last from November 1 through January 15 in most states. However, you may apply at any time if a qualifying event such as moving, getting married, having a baby or losing other health coverage occurs outside of this time frame.
Many eHealth marketplace shoppers don’t realize they qualify for subsidies that could significantly lower the cost of health insurance coverage. It is worth taking the time to use both an online subsidy calculator and marketplace comparison tools (eHealth offers great options).
As your health insurance subsidies are calculated using your actual tax filing, if there are changes in either your income or family size during the year it is important that you notify your health insurance exchange immediately; failing to do so could result in receiving too large or too small a subsidy, potentially having to repay any excess funds back later.
The American Rescue Plan Act expanded access to these subsidies, making them available for more people, so it’s wise to check if you qualify and see if that could mean the difference between having to purchase an expensive plan with higher deductibles and affording one with more manageable deductibles or being forced into something more suitable.
This information should not be taken as tax, accounting or legal advice; for more specific advice please seek a licensed financial, tax or legal advisor who specializes in your situation. This website is operated by eHealth Inc.