Short Term Health Insurance

Short Term Health policy is designed for people in transition, it is a temporary policy for people who are between permanent health plans. Healthy individuals and families who do not need coverage for pre-existing conditions can opt for the short term health insurance policy. The short-term health policy provides a low cost safety net in case of unforeseen illness or injury that might develop during the coverage period.

On basis of the plan, benefit can be wide ranging with most plans providing up to $1-$2million per person. Short term health insurance offers coverage for up to 36 months, though most short term health insurance policies limit the coverage to 12 months. Short term health insurance plans may have benefit limits and you will be required to pay an initial deductible and to make co-payments.

Applying for a short term health insurance policy:

The application process for a short term health policy is quite simpler and easier than a standard long term policy. Coverage for a short term health insurance policy starts within 24 hours of submitting your application. In order for coverage to start immediately you can pay your first premium by giving a valid credit card number with your application. Most short term health insurance plans offer a minimum coverage of 30 days. You can make a single payment up front or elect to pay monthly which makes it easier to drop at the end of any month. At the end of your coverage term most health insurance companies will allow you to re-apply for another short-term plan, further re-applications are not permitted.

An important fact to remember is that a short term health insurance policy will make you ineligible for any Guaranteed Issue individual health insurance plan generally referred to as HIPAA Plans. HIPAA Plans are expensive and are intended for people with pre-existing medical condition, who would have trouble getting health insurance. If you wish to maintain eligibility for HIPAA Plans then you definitely should not purchase a short term health insurance policy.

Short term health insurance policies are meant to protect against unforeseen accidents and illness and hence they do not offer comprehensive coverage. Therefore they do not provide for preventive care, physicals, immunization, dental and vision care and also for any pre-existing condition. Due to this, their monthly premiums are low, which is a major advantage of short-term policies.

Beneficiaries of a Short term Health Insurance Policy:

A short term health insurance policy is actually intended for healthy people. Since it is low cost and high coverage it is well suited for certain sections of the populace.

1)    Part-time and temporary employees, people in between jobs are the foremost consumers of a short-term policy. Since COBRA premiums are expensive and if you do not need coverage for a pre-existing condition, a short term health insurance policy with low premiums is a good option.
2)    Fresh college graduates are another important consumer group of short term health insurance policies. Since new graduates are on the hunt for a job which also offers health insurance benefits, an interim short term health insurance policy is a stop-gap arrangement.
3)    Youngsters leaving home and those over 18 years of age who lose their dependant status under their parent's policy are benefited by a short-term policy. A short term health insurance policy can keep you insured till your individual health insurance plan kicks in.
4)    If you are an early retiree and under 65 years of age waiting to qualify for Medicare, you too can opt for a short-term policy

Working of a Short term Health Insurance Policy:

A short term health insurance policy works as an indemnity plan that gives you the choice to consult any doctor or specialist you prefer. But most plans require pre-certification.
Surgeries, hospital care, emergency service, diagnostic tests, prescription drugs, follow up visits and limited mental health care is included in most short term health insurance plans with certain limitations.

Short term health insurance does not pay unless you actually suffer an illness or injury during the period of coverage.

Short term health insurance policy does not cover a pre-existing medical condition.

Though many short term health insurance policies are renewable up to 36 months, some insurers will not renew your policy if you have filed any claims under your previous coverage. A different company may offer coverage but will treat any illness that occurred during your previous coverage as a pre-existing condition and will not cover cost related to treatment of the illness.
Most insurance companies offer a 30-day guarantee period of satisfaction and refund 100% of your premium within this time frame if you decide not to continue.

Cost of a Short term Health Insurance Policy:

The major advantage of a short-term policy is the low premiums it offers, as it does not cover pre-existing health conditions. The short term health insurance has targeted only healthy people, who will need coverage for a short time period. Given the low risk character of this group few people will make claims and hence the policy is cheap and affordable. A short-term policy offering 24 hour coverage, choice of doctors and hospitals and renewable up to 36 months would cost a family of four only $300 a month. The same policy would cost a single person $70 a month. Most short-term plans allow you to pay all premiums up front or on a monthly basis.

Short term Health Insurance Covered Benefits

Required benefits and limitations vary from state to state, but below are some options that should be included in a short term health insurance plan.

Inpatient and outpatient services provided by a physician, surgeon, assistant surgeon, anesthetist and consultant should be provided. The payment is made by the insurance company based on an allowable amount that is the current negotiated rate of a network provider. Benefit for a second opinion should also be included in the benefit description of your short term health insurance plan. Diagnostic services including x-ray, mammography, pap tests should be included in the plan, though it is accepted that the tests must be referred by a physician. Importantly, coverage for cancer screening tests, screening and diagnosis of prostate cancer, testing for prostate cancer antigen and rectal examination must be covered.

The policy should cover unforeseeable and life threatening illnesses.

Services of a registered nurse, service of a dental surgeon if accidental injury is obtained during the period of coverage. Treatment of diabetes if diagnosed during the period of the short-term policy.

A minimum short term health insurance plan must also include all hospital-related expense like room, intensive care, surgery, anesthetist fees, pre admission testing and other hospital expenses. Professional ambulance service must be a part of the benefit of a short term health insurance plan.

In the event of an accident and the subsequent rehabilitation the rental of a wheelchair, hospital bed, oxygen and its administration, prosthetic devices including artificial limbs, replacement of a natural body part lost while insured.

The short term health insurance plan must fall within the recommended guidelines of your state legislation.

The short term health insuranceplan does not cover preventive care, dental and optical care, pregnancy and childbirth expenses. Treatment of foot conditions, spinal manipulation, cosmetic surgery for acne and hair loss, obesity treatments and sleep disorder. Short-term health plans are exempt from Health Insurance Portability and Accountability Act of 1996.

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