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What is Short-Term Medical Insurance?

Article Details
  • Written By: Karyn Maier
  • Edited By: Bronwyn Harris
  • Last Modified Date: 09 September 2018
  • Copyright Protected:
    2003-2018
    Conjecture Corporation
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Short-term medical insurance refers to a special kind of insurance plan that is designed to provide temporary health insurance for individuals and families. This type of medical plan is ideal for people who are experiencing a lapse in medical insurance coverage due to the loss of employment or a career change. In fact, the majority of people who obtain short-term medical insurance fall within one of these two categories. However, this type of medical coverage may be suitable for others who are without employer-based health insurance for a variety of other reasons.

For example, another significant group that seeks membership with a short-term medical insurance provider is adults over the age of 18. Unless enrolled full-time in college or technical school, people in this age group are typically dropped from their parents' medical insurance plan once they become of legal age. While these young adults may be eligible to extend their previous medical coverage through the Consolidated Omnibus Budget Reconciliation Act (COBRA), the monthly rates can be quite high. Short-term medical insurance, on the other hand, is usually a more affordable alternative.

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There are several advantages to purchasing short-term medical insurance, other than the obvious benefit of enjoying coverage for physician and hospital services. For one thing, most providers allow for freedom of choice when it comes to selecting a physician or specialist without having to worry about network restrictions. However, it is usually necessary to obtain pre-certification from the insurance provider before undergoing any medical procedure or treatment. That said, many plans provide coverage for a wide range of services, including emergency room visits, diagnostic testing, routine and preventive services (i.e., mammograms) and follow-up care. In addition, a short-term medical insurance policy is renewable, usually every 36 months.

There are also a few drawbacks to having a short-term medical insurance, some of which might be reasonably expected. First, pre-existing conditions are almost never covered. In addition, requesting pre-certification for services may automatically cause the condition previously treated to default to pre-existing status later on. In addition, most short-term medical insurance plans do not provide coverage for dental care, vision care, or services related to prenatal care and childbirth.

There are also a few restrictions in terms of eligibility. Generally, only applicants under the age of 65 will be accepted. Short-term medical insurance providers are also exempt from the legal guidelines set forth by the Health Insurance Portability and Accountability Act (HIPAA), which means that they don’t have to provide coverage for pre-existing conditions. In addition, there is usually a lengthy questionnaire to be completed, and the applicant may be required to furnish information about previous hospitalizations, lifestyle habits, and current height and weight. If any of these factors are deemed to put the applicant at higher risk for illness, then he or she may be denied.

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