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What Does Short-Term Health Insurance Cover?

Ever since health insurance became a mandate, it is a concern for everyone. Many people remain in their jobs longer than they intend to, simply because their employer provides their family’s health coverage. If you quit, you lose your health benefits. If only there was a short-term health insurance option in Texas to cover you until you were settled into your next job. What if we told you there was, and you could sign up for it and not have to be concerned about being outside of the ACA open enrollment period? 

What is Short-Term Health Insurance?

Short-term health insurance is fairly self-explanatory. It is temporary health insurance that assists those who need health insurance to bridge the gap between losing their health coverage with one source and obtaining it through another. For example, when you leave a job and start working with a new employer, there is often a waiting period before your new coverage begins, this is your probationary period. STH insurance will assist you with having at least basic coverage for you and your family until your employer sponsored insurance begins.

NOTE: One of the most significant benefits of STH Insurance is that it is often the least expensive of insurance policies. One reason is that it is a short-term policy. Another is due to its limited coverage. If you are currently diagnosed with a health condition, short-term insurance will not work for you if your aim is to receive treatment for said condition.

Who is Eligible for Short-Term Health Insurance?

Obtaining short-term health insurance in Texas is not as simple as filling out a form, answering a few questions about your current health condition, and then suddenly having comprehensive health coverage. Unfortunately, it’s a bit more complex and restrictive. 

Let’s begin with who is eligible. 

Short-term insurance is not common. People use it for specific reasons. There are three basic occasions when people seek this type of insurance. STH insurance is best suited for those:

  • Within the probationary period for an employer-sponsored benefits package. 
  • Waiting for Open Enrollment for the Affordable Care Act. 
  • Close to your eligibility period for Medicare.

It is great that individuals realize their need to remain consistent with their health coverage. Not wanting a lapse in coverage and to remain ACA compliant, people seek a means to bridge the gap. STH insurance meets that need. 

You don’t necessarily need to be in one of the above situations to apply for and receive Short-term health insurance. These are just the most common because of the need they fill. Anyone can purchase a policy at any time. As we will now discuss, it should be understood that this type of insurance is temporary, limited in its coverage, and not always renewable. So, it is not advisable to use as a fix to having a traditional health insurance policy.

Are There Restrictions on What Short-Term Health Insurance Covers?

This is a significant part that must be understood about Short-Term Health coverage in Texas. It is not like the Affordable Care Act and does not have to adhere to many of the stipulations the mandate places on health insurance. 

  • Policy Duration – The short-term label has a purpose. Just how short term is short term? Within the state of Texas, one year. An insured has three hundred and sixty-four days of Short-Term Insurance. It can be renewed for up to an additional 36 months. However, this is not a mandate but an option and is at the insurance provider’s discretion.
  • Health Condition – This is one of the most crucial components of STH insurance. They do not have to accept every applicant that applies or cover every applicant’s condition. This is contrary to what the ACA mandates. Short-Term plans will most often have exclusions for pre-existing conditions. (Your application could even be turned down due to a medical condition.) Also, if the company you have chosen allows renewals, if you develop a health condition during a policy period, they could decide not to renew your policy at the end of your current term. If they do, your new condition would not be covered under the new policy.
  • Coverage Limitation – Many coverage options are not included as would be covered by an ACA policy. These can include maternal care, substance abuse, and prescription coverage. This means that if you see a doctor who gives you medication for your bronchitis, you will need to pay full price for your prescription or find an Rx discount program to help you pay for your medication. 
  • PreExisting Conditions – Like coverage limitations, this takes it a step further. With the Affordable Care Act, if you are pregnant or have high blood pressure, you are covered from day one of your policy becoming active. With short-term health coverage, both of these, among any pre-existing condition, would be excluded from coverage. Your policy application could also be denied due to a pre-existing condition.

Another thing to be mindful of when signing up for short-term health insurance is the application process. If you leave anything out of your history, it could come back to haunt you. Answer all questions honestly, and don’t leave anything out. For instance, let’s say you fall and fracture your hip. Through research, the insurance company discovers you had seen a chiropractor you didn’t report on your application. You would run the risk that your injury would not be covered, even if the accident was unrelated. 

How Do I Get a Short-Term Health Insurance Policy?

Before you jump online, ready to purchase your policy, you need to understand that Short-Term Health Insurance is limited in its availability. Within Texas, there are only nine health insurance companies that offer these policies. 

  • AdvantHealth
  • Aspen
  • Companion Life
  • Everest Reinsurance
  • Independence American Insurance Company
  • National General
  • Standard Security Life Insurance Company
  • United Healthcare (Golden Rule)
  • United Security Health and Casualty

A few other companies offer policies but do not have an online presence. These are Moda Health, Philadelphia America Life Insurance Company (New Era), and United States Fire Insurance Company.

In addition to insurance company, there is also location. Even the best companies are sometimes only available within a certain number of states. So, while the above list has nine companies, that number could be reduced depending on where you live. 

Additional Options to Short-Term Health

You do have other options to a Short-term health insurance policy. This is always situation based. Do any of these situations apply to you?

Situation One – Special Enrollment or Qualifying Event – Double-check the Affordable Care Act list of qualifying events. The reason you are switching health insurance plans could be on the list, and you may not even need to apply for an STH insurance policy. This would be beneficial, especially if you have one of the above reasons that would place restrictions or even disqualify you from coverage.

Situation Two – Medicaid Eligible – This option is available if you meet certain low-income requirements. Even if your earnings are close, applying and finding out is best. It is a simple process. You apply through the ACA Marketplace, and if you qualify, your application is sent to the Texas Medicaid agency, and they contact you. If not, you are given a list of ACA Marketplace plans you qualify for when Open Enrollment is available.

Situation Three – COBRA Eligible – This option is only available if you are leaving a job and have health insurance through that job. Employers are required by federal law to offer the option to allow their employees to continue their health benefits. Only the employee most likely assumes all costs of the plan. You may get lucky, and an employer could assume some of the cost, but this is rare. Shoppers can continue on this program for up to 18 months. In some cases, longer. 

Summary

When you need health insurance, there are always options. Short-term health insurance in Texas is one that helps you best when you need temporary coverage to bridge the gap between two forms of coverage. Bear in mind that any health condition you sign up with will not be covered under the policy. When you have questions about coverage options, you need an expert like those at Cover Mile to guide you through the insurance purchasing process. Contact one of our agents today.