Keenan Blog

Short Term Thinking

May 18, 2018

In the next few weeks, thousands of students nationwide will be graduating from colleges and universities. We congratulate all of them on their academic accomplishments and wish them future success. Although employment prospects are the best we’ve seen in years, for many of these graduates, there will probably be an interval between getting out of school and the beginning of a new job. If you are not covered by health insurance before you become eligible for employee benefits at work, you may want to study a short-term solution.

Short term medical plans are now widely available options for the many people who are not immediately eligible for coverage from employers or under the Affordable Care Act (ACA). Besides being a recent graduate, the most common reasons you might fall into one of these gaps are:

  • Losing your parent’s insurance coverage at age 26
  • You missed Open Enrollment and do not have a qualifying event for Special Enrollment
  • You’re waiting for your ACA coverage to begin
  • Waiting for benefits to begin at a new job
  • Waiting for Medicare
  • Needing a temporary alternative to COBRA continuation coverage
  • Losing coverage following a divorce

A short-term health insurance plan is a flexible option with choices regarding length of coverage, deductible, coinsurance and maximum coverage amount. Typically, if you only need health insurance for a short period of time (usually less than 2-3 months), this type of plan can help fill in the gap until you get a permanent plan. Whether you are waiting for major medical coverage, or looking for an affordable COBRA alternative, a temporary health insurance plan could be the right choice. Coverage for both individuals and family plans are available.

However, there is a reason these are just “short-term” medical plans. They do not meet the ACA’s minimum essential coverage requirements and you could be subject to a federal tax penalty for the months you have short-term medical insurance. While these plans can give you coverage almost immediately, short-term medical plans are not required to provide the ten essential medical benefits included under ACA qualified plans. For example, short-term plans may not cover prescriptions or may offer them only as an optional benefit. Most importantly, short-term medical plans do not cover preexisting conditions. But if you are in good health, short-term medical can be a temporary solution until ACA Open Enrollment or become eligible for other benefits.

If you, a family member or a friend fall into the situation of not being currently eligible for regular health insurance, consider how a short-term medical plan can provide greater peace of mind during those times. KeenanDirect can assist you in exploring your health insurance options and help you be sure you are ready when Open Enrollment rolls around.

About Sam Cole
Sam Cole serves as Vice President of KeenanDirect. He has more than two decades of experience in the California insurance market. He is a Lifetime qualified member of the National Association of Health Underwriter’s (NAHU) Leading Producers Round Table. You can contact KeenanDirect at 855-653-3626 or visit