Best Short Term Health Insurance
Based on In-Depth Reviews

The number of uninsured Americans is on the rise again for the first time in a decade. According to new census data, 27.5 million people had no form of health insurance in 2018. That’s nearly 2 million more than the number of uninsured in 2017. Census officials said this marks the first year-to-year increase of uninsured people since 2008-09, when the Affordable Care Act (ACA) was passed.

The reasons for this increase are mostly speculative for now. However, analyses from the Kaiser Family Foundation, the Congressional Budget Office (CBO), the Joint Committee on Taxation (JCT), the Commonwealth Fund, the Urban Institute, and the Center for Children and Families suggested that the increase in the number of uninsured Americans could be due to rising health insurance premiums. Other factors may include:

• The repeal of the Affordable Care Act’s individual mandate
• Expanded availability of short-term limited duration policies
• The addition of work requirements for Medicaid enrollment
• Certain states’ refusal of Medicaid expansion regardless of federal funding to match coverage of their poorest citizens

The U. S. Census Bureau reported the rate of uninsured American was on the rise again

After the Affordable Care Act came into effect, the percentage of uninsured decreased historically. This was due to ACA’s efforts to extend Medicaid coverage to many low-income individuals. New census data shows the first significant rise in uninsured population in a decade. Statistics provided by the U.S. Census Bureau.

According to the CBO, new federal rules regarding short-term health plans will prompt about 4 million people to drop comprehensive ACA individual or small-group coverage to enroll in short-term plans or association health plans over time. 

The US Department of Labor defines association health plans (AHP) as group health plan that employer groups and associations offer to provide less expensive health coverage for employees. AHPs also allow small employers to band together to purchase types of coverage available to larger employers. In contrast to short-term health plans, AHPs can’t deny coverage based on health or prior conditions. However, the lower premiums that short-term plans and AHPs offer to healthy people are not necessarily available to individuals with pre-existing conditions. And like short-term health plans, AHPs aren’t nearly as robust and comprehensive as ACA plans, which will leave many people with greater out-of-pocket healthcare costs.

The expansion of short-term plans and the use of association plans as a way to get around the requirements of the ACA concern healthcare experts. “The current administration’s expansion of short-term plans will leave people who buy these plans with large gaps in coverage and will raise costs for people with pre-existing health conditions,” says Aviva Aron-Dine, Vice President for Health Policy at the Center on Budget and Policy Priorities.

Short-term plans are exempt from many of the ACA’s consumer protections, including its prohibitions on denying coverage for those with pre-existing conditions or charging higher premiums based on an individual’s health status. 

By 2029, the CBO anticipates the number of uninsured people in the US  will grow to 35 million, or 13% for people under age 65. That estimated growth is due to an increase in the number of people expected to forgo comprehensive health insurance in response to the elimination of the individual mandate penalty. Again, an additional factor is people’s increasing enrollment in coverage from sources that do not meet the CBO’s and the Joint Committee on Taxation’s definition of health insurance, such as short-term plans.

“Moreover, CBO’s analysis may not fully account for the widespread use of deceptive marketing practices by short-term plan sellers, as documented in a recent Georgetown Center for Health Insurance Reforms report. If these practices are prevalent and successful, more people will likely enroll in even worse health plans than the CBO projects,” stated Aron-Dine.

Affordable Care Act vs. Short-Term Health Insurance

Before signing up for short-term health insurance, there are a few things to consider. First and foremost, short-term plans aren’t considered comprehensive health insurance under federal law, as a result they aren’t required to be compliant with Affordable Care Act consumer protections.

This year, the current administration set forth new regulations to expand the availability of short-term health insurance by allowing these plans to be offered for up to 364 days and renewed at the discretion of the insurer for up to three years (36 months).

Short-Term Health Insurance Key Takeaways:  

• Federal rule now allows 364-day plans, with option to renew for up to 36 months
• There are 11 states where no short-term plans are available
• Enrollment in short-term coverage is likely to increase over the next decade
• Short-term plans are aggressively marketed to consumers
• Multiple health organizations have filed suit to invalidate the new regulations governing short-term plans that allow them to provide coverage for up to 364 days and to be renewed for up to 36 months.

While the final rule’s expansion from three to 12-month policy terms can be seen as a plus for consumers who may have missed the open-enrollment deadline and do not qualify for other healthcare alternatives, light regulation in some states has incentivized some of the less than ethical operators in the business to ramp up their practices, according to a Georgetown  University study.

According to faculty at the Center on Health Insurance Reforms at Georgetown University, many people purchase short-term plans mistakenly believing that they are as comprehensive as ACA plans.

“Most of the time, people don’t realize what they’re getting into when they purchase short-term health insurance plans,” said Cheryl Fish-Parcham, Director of Access Initiatives of Families USA. “They are taking major health risks, as these plans don’t have to comply with marketplace standards set by the Affordable Care Act. What people don’t realize is that with a short-term plan, you could end up paying more out-of-pocket expenses.”

Fish-Parcham suggested that consumers would be better off purchasing a comprehensive insurance plan or marketplace alternative rather than a short-term health insurance plan.

“People could be exposing themselves to denied coverage or financial risk when choosing short-term plans,” said Fish-Parcham. “Even when some short-term policies state they offer mental health coverage, their pre-existing conditions policy terms will be so complex that the person seeking coverage will probably not be eligible. On most occasions they will give you a per-dollar limit on care, for example, $1,000 per-day-limit for hospitalization. It’s very important that consumers read the fine print and policy terms thoroughly if they choose this type of plan.”

The Kaiser Family Foundation, a nonpartisan research organization, compared short-term insurance plans as a sort of tradeoff to consumers – lower premiums in exchange for more limited coverage and less protection than ACA-compliant plans. 

Short-Term Health plans are exempt from Affordable Care Act consumer protections

According to Mental Health America’s The State of Mental Health in America 2018 report, one in five adults –that’s 40 million Americans, or more than the population of Florida and New York combined– have a mental health condition.

In April 2018, the Kaiser Family Foundation found that on average, 57% of short-term health insurance plans sold on eHealth and Agile Health Insurance websites don’t cover mental health, and 38% don’t cover treatment for substance abuse. The report was published by Families USA.

Currently, 7 million people have both a mental health and substance use condition. Short-term health insurance policies generally do not cover substance use treatment, leaving most of this population vulnerable.

National General, Secure Lite, Everest Prime, Standard Life Select, LifeShield, UnitedHealthOne (Medical Value), UnitedHealthOne (Medical Plus), Companion Life, and Aspen do not cover injuries resulting from intoxication, alcohol or drug use.

According to NPR, the average age of first-time moms in climbing in the US. By 2016, the common age when women have their first child is 26.3. Short-term health plans may cover complications due to pregnancy, but they are very limited. These policies do not cover abortions.

The National Center for Health Statistics reported that nearly half of the US population over the age of 12 took prescription pain relievers, tranquilizers, sedatives or stimulants. Prescription drug use increased with age, from 18% for children under 12 years to 85% of adults aged 60 and over.

At least 16% of the time those drugs are misused by nearly 19 million Americans, according to the Centers for Disease Control and Prevention.

The Kaiser Family Foundation found the following facts on Short-Term Limited Duration plans:

According to Debt.org, the average costs for common surgeries are:

Most Health Organizations Don’t Recommend Short-Term Health Insurance

In 2018, seven health organizations filed a lawsuit to invalidate the short-term, limited-duration plan’s final rule. These organizations include The National Partnership for Women & Families, AIDS United, America Psychiatric Association, Mental Health America, National Alliance on Mental Illness, Association for Community Affiliated Plans, and Little Lobbyists, LLC.

The final rule expands access to short-term, limited duration insurance coverage by extending the maximum duration of these plans from three months to up to 12 months. The rule also allows insurers to renew or extend coverage for up to 36 months and requires organizations to update notice requirements.

However, top health organizations believe this new rule puts consumers at risk, as many people could mistakenly believe that short-term limited duration plans could replace comprehensive health coverage.

“This rule will harm patients and their families as well as others in the health care system by undermining access to quality, affordable coverage, will significantly disrupt insurance markets in states across the country, and threatens to bring back abusive practices that harm consumers specifically prohibited by the Affordable Care Act (ACA),” said the National Alliance on Mental Illness in a statement.

Similarly, other organizations have pushed back against the new regulation including the American Academy of Pediatrics and the American Medical Association (AMA).

“The American Medical Association has raised considerable concern with increasing the duration of short-term limited duration insurance (STLDI) plans beyond three months,” said Robert Mills, AMA press representative.

The AMA sent a letter to the Departments of Treasury, Labor, Health & Human Services in April 2018 urging withdraw of its proposed rule to expand the duration of STLD plans. In their letter, they cite short-term limited duration plans are “deficient and destabilizing” and that the new rule will be “devastating to the health of millions of Americans – disproportionately so for women, children and the chronically ill.”

As of 2015, 50 to 129 million non-elderly Americans have some type of pre-existing condition, according to the Department of Health and Human Services. At the time, 25 million individuals with pre-existing conditions were uninsured. This year that number will likely spike up as new census data becomes available. 

On April 2019, the consumer representatives to the National Association of Insurance Commissioners (NAIC)  raised concerns that the proliferation of short-term, limited duration insurance coverage would confuse consumers, leaving some who sign up for short-term plans facing higher out-of-pocket costs, denied claims, and unpaid medical bills, while also leading to adverse selection that harms states’ individual marketplace.

According to the NAIC study, most consumers don’t understand what short-term health insurance coverage really entails. This lack of understanding combined with concerns about aggressive marketing strategies of short-term plans will likely result in confused consumers unintentionally enrolling in short-term plans when doing so may not be sufficient to cover their health needs or financial situation.

Furthermore, this year the House Committee on Energy and Commerce launched an investigation into companies that sell or broker junk health insurance plans. In their investigation, they are examining aggressive marketing strategies, STLD plans that have discriminated against individuals based on pre-existing conditions, and denied coverage of claims, thereby putting consumers at financial and medical risk. 

Organizations they are looking into include Agile Health Insurance, Anthem, Arkansas Blue, Cross Blue Shield, Blue Cross Idaho, Cambia Health Solutions, eHealth, Everest, Health Insurance Innovations, Healthcare Solutions Team, Independence Holding Company, National General Accident and Health, UnitedHealth Group, LifeShield National Insurance Co., and Pivot Health.

Affordable Alternatives to Short-Term Health Insurance

CHIP provides low-cost health coverage to children in families that earn too much to qualify for Medicaid. One of the perks of CHIP is that, like Medicaid, you can apply for it throughout the year to see if you qualify. In some states, CHIP covers pregnant women. Each state has its own rules about who qualifies for CHIP. If you apply for Medicaid coverage to your state agency, you’ll also find out if your children qualify for CHIP.

• To find coverage for your family visit InsureKidsNow.gov. 
• Fill out an application through the Health Insurance Marketplace. If anyone in your family qualifies for Medicaid or CHIP, your information will be sent to your state agency  and they will contact you for enrollment. 

Medicaid is a state-run and federal program that provides health coverage if you have low income. States set their own guidelines and determine the type, amount, duration, and medical services available within federal guidelines. Federal law requires states to provide mandatory benefits and allows states to choose optional benefits.

Medicare is a federal program that provides health coverage for individuals who are 65 years and older or for people under 65 with specific disabilities, no matter their income. You can apply online even if you’re not ready to retire. There are two main ways to get your Medicare coverage: Original Medicare or a Medicare Advantage Plan (Part C). 

If you are eligible for both Medicare and Medicaid (dual eligible), you can have both. Make sure to call 1-800-MEDICARE or contact your local Medicaid office to learn more about Medicare and Medicaid costs and coverage, as covered services and cost-sharing may vary depending on which plan you have.