Short-term medical has undergone several changes this year. It used to be available for extended periods of time with the option of renewal every year. However, a new law, which went into effect April 1, 2017, restricted short-term medical plans to three-month coverage periods. In addition to the three-month period, the law also inhibits renewals with the same carrier. While carriers must adhere to the three-month limitation, some have found a loophole regarding renewals. After every ninety days, individuals can re-apply with the same carrier, in some cases indefinitely depending on the state.
As for pre-existing conditions, short-term medical does not fall under the Affordable Care Act. As such, short-term medical plans do not cover pre-existing conditions, unlike qualified health plans (QHP). So with the new law in effect, an individual could break their arm during a three-month coverage period and then not receive coverage for the injury when they re-apply for another short-term policy; in this scenario, the broken arm becomes a pre-existing condition for the next policy term. Carriers, however, are trying to solve this problem; in fact, some are even looking into making pre-existing conditions – that occur during a short-term policy – covered in subsequent short-term policies with the same carriers.
Since the law is new, many of the potential changes to short-term medical are all speculative. On that note, it’s best to contact a licensed agent; they can guide you through the murky waters of the insurance industry and help you find the plan that’s right for you.
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