You can no longer enroll in a regular health insurance plan under the Affordable Care Act, unless you experienced a Qualifying Life Event such as you got married or divorced, had a child, moved to a different state, lost your previous health benefits, or experienced a change in income so that you are now qualified or not qualified for a subsidy to help you pay your monthly premium.
If you are still uninsured and need insurance but did not experience a Qualifying Life Event, you may enroll in Short Term Health Insurance. With Short Term Health Insurance, you can rest assured that if you need healthcare, you’re covered and oftentimes for a more affordable price than a regular health insurance plan.
Be aware that a Short Term Health Insurance plan is not ACA compliant, which means that you may still be taxed for not having a regular health insurance plan, but if your goal is to simply have the coverage until you can get on a regular health insurance plan, a Short Term Health Insurance plan is a great alternative!
Open enrollment to sign up for health insurance under the Affordable Care Act for the 2015 calendar year finally came to a close on April 30, 2015. The 2015 Open Enrollment deadline was originally set for February 15, 2015; however after many states and the federal government realized that some Americans would not understand the financial implications of being uninsured until after they filed their 2014 tax returns and was made aware of any penalty for not enrolling, the deadline was extended until after the tax filing deadline.
Now that the 2015 Open Enrollment Period is closed and Americans may not enroll for the 2016 calendar year until November 1, 2015, the only way to get insured is to either enroll in a Short Term Health Insurance plan (you may still be taxed under the law with this type of health insurance plan), or to experience a Qualifying Life Event.
If You Didn’t Enroll For Obamacare In Time
Short Term Health Insurance Might Be Your Only Option
With the open enrollment period for Obamacare a distant memory, people who didn’t pick up Affordable Care Act-mandated health insurance could be in serious trouble. The next open enrollment period does not begin until November 15th, which leaves millions of Americans vulnerable to steeper premiums and the infamous “shared responsibility fee”, aka, a tax penalty for not having coverage. This has prompted people to begin examining their options in case of job loss or substantial life changes that may force them to lose their existing coverage between open enrollment periods and to consider possible “gap” health coverage. One of these options is short-term health insurance.
What Is Short-Term Health Insurance?
As the name implies, short-term health insurance is designed to cover eligible people for durations ranging from 30 days to 12 months. 15 states have six-month cutoffs for short-term health insurance, and in the other 35, the amount of time a short-term policy must be in effect by law varies. Short-term health insurance has become an attractive option for people who have lost their previous health insurance and been forced by employers to take higher-cost insurance options, as well as those who did not purchase ACA health insurance or simply could not afford it.
However, this shortfall in ACA coverage has placed many Americans in a difficult position. If they lose their job, it is likely they will also lose their ACA-purchased insurance. This in turn leaves them with only three options: either purchase ACA insurance on their own and pay the full premium themselves; take COBRA insurance, which costs a great deal more than regular insurance and is only intended for gap coverage for a maximum of up to 18 months at a time when millions of Americans have been out of work for two years or more; or accept short-term health insurance.
Short-term health insurance is a viable, low-cost option for healthy people who are solely concerned with catastrophic coverage or who are more interested in a low premium than good coverage. While many people have called short-term health insurance “junk,” this is really in the eye of the beholder. Much of the reason for this negative reaction to short-term health insurance lies in what these policies don’t offer, instead of what they do. These policies:
- Are not subject to the same rules as ACA-approved insurance
- Do not have to cover the same things as ACA insurance
- Can deny people for preexisting conditions or being ill at the time of taking the policy
- Generally do not meet the minimum healthcare requirements of Obamacare, including pregnancy and childbirth or sports accidents
- Do not allow policyholders to qualify for Obamacare credits or to avoid the shared responsibility fee
Is Short-Term Health Insurance Really Better Than Nothing?
If you don’t qualify for a special enrollment period or missed out on ACA enrollment for whatever reason, short-term health insurance will cover you if you suffer an accident or if something comes up that isn’t considered a preexisting condition. However, if you are or plan on becoming pregnant, if you are ill or think you might become ill prior to receiving your policy, or if you play sports and could be injured, short-term health insurance will not pay. In addition, ACA coverage providers are not allowed to refuse coverage based on medical history or preexisting conditions, whereas short-term health insurance is.
Short term health insurance is precisely what it sounds like, a short term solution, meaning that there are certainly better options out there and you should seek those out if you are eligible. That said, if you are not eligible and you have to wait until the next open enrollment period, and you need coverage, short term health plans are something to strongly consider. We suggest that you consult with a licensed healthcare professional who can answer any of your questions.