Short Term Health Insurance Substitute COBRA Insurance
If you’re recently unemployed, you haven’t just lost a job; you’ve probably lost a whole lot of benefits with it, prime among them being medical insurance. In this situation, you do have a solution in the form of short term insurance, which can be purchased instead of the often costlier COBRA insurance.
COBRA insurance guarantees continuation of medical coverage for up to 18 months after a person loses his/her job. COBRA insurance, however, is more expensive than regular insurance, and the conditions for qualification are stringent. In this tough situation, short-term medical insurance can really help a family by providing much-needed medical coverage.
Short term medical insurance offers a load of benefits including physician visits in case of illness, hospitalization, and most medical care. That includes ambulance services, surgery, prescriptions, and diagnostic tests. Previously existing conditions, and anything considered routine care (teeth cleaning, eye check ups) are not covered under the plan.
You can usually purchase temporary insurance for periods ranging from a month to a year. Remember that some plans may consider each renewal a new policy, which means that the premium rates may have changed, and also your eligibility in terms of pre-existing conditions. You will find that the process of renewal is actually very simple and easy.
While a person can use temporary insurance to tide over an otherwise uninsured period in life, temporary insurance cannot substitute long-term insurance, which provides full permanent medical coverage, including routine check-ups, pregnancy, and other medical conditions.
When getting back on a regular long-term health plan, short-term medical insurance can often be counted toward creditable coverage for group plans. Labeling an insurance plan as creditable coverage means that the plan counts as equivalent coverage when determining pre-existing conditions and effective continuous period of coverage. Short-term medical insurance plans are usually not considered creditable coverage for individual plans.
One other factor that tilts the balance in favor of short-term medical insurance is the ease of signing up for a plan. Being a temporary plan, there are usually no lengthy underwriting procedures, and the plan can typically be purchased online.
For temporary insurance of around six months (or less), short term insurance can work quite well. It can also be a better option than COBRA insurance for many people, but it is important to know that short term insurance is just that short term.
Dan Miller often writes about short term insurance.