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Short-Term Thinking

Short-term thinking has rather a bad reputation.  Temporary solutions suffer a similar fate; they are looked upon as shady or somehow suspect.  This may well be a holdover of our nation’s prim heritage, and in many ways, there is nothing wrong with this line of reasoning.  However, there are times when a short-term solution is just what the doctor ordered!

There is a form of health insurance called short-term health coverage, or temporary health coverage, that is really useful in the right situations.  It’s all about transitions: from one job to another, for those newly hired and in the waiting period for the company plan, for recent graduates, those losing dependent status, as an option to COBRA, early retirees, people on strike and so forth.

Sometimes there is a long wait for approval in the individual health insurance market and you may not want to be without coverage while you get through your 30- or 45-day wait until the effective date of a new plan.  If you have a short-term policy in place while you wait, you will move easily over to your new plan without a coverage gap.  And should you be turned down for that standard health insurance plan, you still have coverage while you apply again with another carrier.  Think of it as a safety net.

A temporary health insurance policy works like an indemnity plan; you can see any doctor or specialist you choose.  The plans provide coverage against unforeseen illness or injury: pre-existing conditions and their treatment are not covered, nor, as a general rule, are wellness visits, preventive care, vaccines, or vision or dental care.  With most plans, you will need pre-certification from your insurer before you are hospitalized, except in an emergency.  Without pre-certification, the plan may not reimburse you for hospital bills.

The actual benefits in your policy vary according to specific state regulations and plan design, and they are improving all the time.  Most temporary health insurance plans will cover hospitalization, doctor office visits, organ transplant,  repatriation and diagnostic tests.  Prescription drugs, surgery, follow-up visits and even limited mental health care could also be included.

The plans offer coverage for as short a time as one month and as long as a year.  Some are renewable for up to 36 months.  Maximum coverage limits of $1 to $2 million are typical.  Many plans feature a range of deductible and co-insurance options which are selected during the application process.

Advantages of short-term health insurance plans: 

  • Short-term coverage is less expensive than traditional medical coverage.  Get in an accident, suffer an injury, be hospitalized for an illness, and your treatment is covered.  It is imperative, however, to read the policy very closely to understand what is and what is not covered.  
  • Plans can be used with any doctor or hospital in the US; there are no physician networks to navigate.
  • You are covered the day after your postmark the application.  If you apply online, you are covered on the following day.
  • The application process is very simple.
  • Most carriers take credit card payments.
Next, the disadvantages of short-term coverage, and some application ‘how-to’s’, along with links to some of the better carriers. 
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