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Short Term Health Insurance
Bridge the Gap
A Short Term health insurance policy may be perfect for a Colorado resident needing to bridge a gap between health insurance policies for a short period of time.
When a life change leaves you without health insurance, you need coverage to get through that transition period. Although the change may be defined as a “qualifying event” allowing you to enroll in a permanent plan, there may still be a gap in coverage.
-Are you a graduating student?
-An early retiree waiting for Medicare to start?
-A new hire in your waiting period before group coverage begins?
-Or did you miss the deadline for an open enrollment period?
Take a few minutes to check out our short term insurance quotes and see for yourself!
Definition of a Pre-existing Condition:
Any medical condition for which you experienced symptoms, had signs of, received medical advice or treatment (including taking prescription drugs) within the last 12 months.
• Provides Major Medical coverage
• Low premiums-– much more affordable than permanent plans
• Short application-- takes 5 minutes to complete
• Next day effective date
• No doctor network to worry about
• Pre-existing conditions are NOT covered.
• There is no automatic extension of coverage past the initial number of months you signed up for. (Maximum of 3 months.)
• Colorado allows only 2 term policies in a 12 month period of time.
• Policies don’t renew so the deductible resets with each separate policy.
• Doesn’t cover preventative adult benefits except for routine cancer screenings.
• Subject to lifetime limits— some as low as $250,000.
• Some benefits may not be included such as mental illness, maternity, etc.
• Short Term plans are not compliant with the Affordable Care Act: you will still be subject to the tax penalty if you are not compliant for 3 or more months of the year.
Two ways to buy:
Short term policies can be bought and paid for in one of two ways.
The first way is for a set period of time, say 60 or 90 days, where you prepay for the exact number of days you are purchasing. This is the least expensive way to go, typically yielding a 20% discount off the month to month premium. But you do have to pay the lump sum up front.
The second way is to go month- to-month where you can keep the policy going for up to 3 months—all at your discretion. This is easier for the monthly budget too.
So which way should you go?
This can be a surprisingly difficult question to answer, but we usually recommend the month-to-month option, even though it costs more.
1. Going month-to-month gives you flexibility to keep the policy if you are not sure how long you need it for—or if you do develop a medical problem and want to keep the insurance under your current deductible for the full three months.
2. The state of Colorado has a law that says you cannot buy more than two short term policies within a 12 month period—regardless of whether it is for one month or three months. We once had a client who purchased a one month policy in anticipation of going on a group plan, then came back a month later saying that the boss said it would be another month before he could go on the group plan, so he bought another one month policy. A month later he was back saying the job did not work out and he needed another short-term policy. We had the unpleasant task of telling him that he was out of luck because we could not write another short term policy for him with ANY company due to our Colorado law (which was new at that time).
Bottom line: We recommend going month-to-month; unless you are 100% sure of how long it will be before you will get on some other permanent insurance. Or, if you need to buy a short term policy for two to three months, then buying the fixed number of months makes sense. If you are truly 100% sure, then go ahead and buy the fixed number of policy days since it will save you money.