The volume of uninsured Americans is rising in the United States. That reality is causing more financial strain on families as they get sick and declare bankruptcy over medical expenses.
Legislation like the Affordable Care Act has made it simpler for people to attain healthcare coverage but even the ACA has limits that disallow the average citizen to enroll outside of its month-long “enrollment period”. Fortunately, temporary health insurance can help families bridge the gap between where they’re at with coverage today and where they hope to be tomorrow.
If you’ve never heard of temporary health insurance and would like to know more about its benefits and drawbacks, keep reading.
What Is Temporary Health Insurance?
Temporary health insurance encompasses short term plans that are designed to help individuals avoid catastrophic medical expenses when they’re between long-term plans. These plans are flexible and can be canceled at any time which is why they’re often referred to as “gap coverage.” They can, generally, be squeezed into any insurance gaps that your family is experiencing.
The catch is that gaps need to be seen as temporary.
Who Is Temporary Health Insurance Coverage Valuable To?
Several situations lead Americans to purchase temporary health insurance. Three common situations include:
Missing Your Enrollment Window
The ACA only allows citizens to opt into coverage during an enrollment period. This period usually takes place between October and November.
If you miss that enrollment window and don’t have special circumstances to excuse your miss, you’ll get left uninsured. Temporary health insurance can help you stay safe during this time.
Waiting for Your Primary Coverage to Begin
If you received a new job, it may be that your employer’s health insurance won’t kick in until the first of the month. For people that will be left uninsured over the weeks that they’ll need to wait for their primary coverage to kick in, temporary health insurance is a great option.
Loss of Employment
When you lose your job, oftentimes, you’ll lose your healthcare coverage as well. Fortunately, the ACA enables people to opt into a primary insurance provider outside of its enrollment window if a change in employment has occurred.
Still, between when you’re let go and your enrollment in an ACA plan, temporary coverage can keep you safe from an accident.
What Are the Drawbacks of Temporary Health Insurance?
Temporary health insurance is not a viable option for long-term use. That’s true for several reasons including:
These Plans Are Non-Renewable
Many temporary health insurance plans have limits on how long you can hold onto them for. Once you’ve exceeded that amount of time, your plan will not be eligible for renewal.
If your temporary plan expires and you can’t get full-time coverage, you have options. You can either opt in to a long-term healthcare plan (if possible) or you can buy into another temporary plan through a different provider.
They Do Not Meet Federal Requirements
When the ACA was first passed, a tax penalty was levied against those that didn’t have healthcare coverage. That penalty was since removed by the Trump administration but may remain on your state’s level.
It’s important to note that no government entity, state or federal, will see temporary coverage as sufficient. Therefore, if penalties exist in your locality for non-coverage, you’ll be forced to pay them.
They’re Generally for Emergencies Only
Few temporary plans offer good coverage for things like preventative care and prescriptions. Temporary plans, consequently, are only good for serious situations that have the potential to bankrupt.
They are not a 360-degree healthcare solution.
Pre-existing Conditions Are Not Covered
If you have pre-existing conditions, you’re out of luck with temporary plans. Unlike long-term plans, temporary options aren’t legally required to cover those that are already sick.
To get quality healthcare coverage that takes care of chronic ailments that you may have, you’ll need to opt into ACA coverage.
Where Can You Find Temporary Plans?
Finding temporary insurance plans is a more hands-on experience than shopping for coverage through healthcare.gov. Temporary plans are given out by individual, niche providers that you’ll have to purchase from through their websites.
As you search for temporary health insurance online, read about providers to ensure their legitimacy. Also, read through your plan carefully before buying it. That way, you can ensure that your coverage has enough provisions to be worth your while.
Is It Better to Buy a Temporary Plan or Wait Out the Gap?
As you now know, there are drawbacks to temporary healthcare plans. Given those shortcomings, it’s often wondered if waiting out your healthcare gap makes more sense than picking up a plan.
Depending on the length of your gap, the odds may be in your favor that you won’t need the assistance of a temporary plan. Despite that, given the unpredictable nature of health, it’s always a good idea to invest in temporary insurance. At least until you can find the support of a long-term plan.
Passing on temporary coverage could cost you thousands of dollars in unexpected bills.
Wrapping up Our Primer on Temporary Health Insurance
Temporary health insurance is a viable means to an end, despite being imperfect. Our best advice is to do everything in your power to opt in to an ACA plan during its enrollment window or via special life circumstances.
If you can’t, get a temporary plan for you and your family to make sure that a broken bone doesn’t mean a broken bank account.
For additional insight into all of life’s biggest questions, browse more of the content that we have up on our blog.
I’m going to read this. I’ll be sure to come back. thanks for sharing. and also This article gives the light in which we can observe the reality. this is very nice one and gives indepth information. thanks for this nice article…home insurance