Now that it looks like we may be able to have a Short Term Medical Policy for more than three months again, what are the pros and cons?
Well, first, it isn’t quite effective yet. One of the last Executive Orders President Obama did on insurance before leaving office was to reduce the time a Short Term Medical Policy could be purchased from 12 months to 3 months.
President Trump has now done an Executive Order allowing them to go back to 12 months, but it is still in the comment time-frame.
Once we have 12 month Short Term Medical Policies again, they may be a very viable option for healthy individuals, wanting catastrophic coverage. But, as with anything, you have your good and your bad.
Short Term Medical Policies are less expensive than the higher cost ACA Compliant Plans … usually, a lot less expensive. That is good! But, they do not cover any pre-existing conditions, they are subject to medical underwriting and approval, and they do not cover some of the Minimum Essential Coverage (MEC) benefits. For example, maternity coverage, wellness benefits, mental nervous benefits and pediatric dental and vision are not included in Short Term Medical policies. In addition, they do not have the Unlimited Lifetime Maximum, but usually have a lifetime maximum of $1,000,000 (sometimes twice that, and sometimes half that). Some of these policies don’t include prescription drug coverage. So, it is very important that you understand what you are buying.
On the flip side, if you are healthy, and can pass medical underwriting, you probably do not have any pre-existing conditions or take any medications, so your premium is not being increased for coverage you are not using. However, if you find you experience a health condition mid-year, and you need prescription drugs, you should ask your physician about generics, as your out of pocket cost would be less. In addition, you should use websites such as www.goodrx.com to look at the cost of the prescriptions, as well as any discounts and manufacturer’s coupons available.
A lot of these policies do not have the doctor copays everyone likes so well. Some of them will let you add copays for additional premium. Once you look at that premium, make sure you do the math, and see if the copay is worth adding. If you are healthy, you may only go to the doctor once a year or less. Once again, though, they normally have the larger PPO networks on the plans, instead of the very limited HMO networks we see on the ACA Compliant Individual Medical plans.
That also brings up the Virtual Visit coverage that is becoming very popular. This would be a great product to buy, in addition to a short term policy, as it would provide you with the ability to have a doctor call you and prescribe medication for a number of conditions, if needed, for either a low copay or no copay in some plans.
As always, we always want to look at your specific situation to determine if this may be a solution for you! Give me a call to discuss.