What You Need to Know
No insurance companies currently offer short-term plans in Colorado.
Alternatives to short-term plans include ACA plans, Medicaid, or COBRA coverage.
Short-term medical insurance may not cover everything ACA plans are required to provide.
There are times when Colorado residents might need temporary medical coverage. For example, while you’re waiting to turn 65, are between jobs, or waiting for the next Affordable Care Act (ACA) Open Enrollment Period. A short-term health insurance plan can fill those gaps in insurance coverage.
But right now, no insurance companies are offering short-term insurance in Colorado. That could change, so it’s good to understand how these plans work. It’s also smart to know what other options you have to avoid steep medical expenses for an unexpected illness or injury.
What Is Colorado Short-Term Health Insurance?
Short-term health insurance plans provide the coverage you can purchase at any time during the year. These medical insurance plans are designed to bridge periods when you don’t have health insurance. Coverage may begin as soon as you enroll. In most states, premiums tend to be more affordable than the cost of an ACA plan without a subsidy. That’s because short-term plans aren’t required to provide the comprehensive coverage that ACA plans do.
In many states, short-term insurance plans follow federal rules with terms lasting no more than 364 days a year, but renewals are allowed three times or up to 36 months. Other states have developed their own rules and others prohibit short-term plans altogether. Although Colorado law allows companies to sell short-term plans, none currently do. State rules are so restrictive that insurers stopped selling plans there. In Colorado, plans can only last for 6 months and cannot be renewed. And Colorado requires short-term plans to offer many of the same benefits that ACA plans do. Due to these regulations, insurers have stopped selling short-term plans in Colorado.
Bridging the gap
If you can’t afford traditional health insurance, short-term health insurance may be a good choice to fill a temporary gap in coverage. But there are other options as well.
Can You Enroll in Short-Term Plans in Colorado?
There are no companies currently offering short-term plans in Colorado. If an insurer offered short-term plans here, Colorado state law and Division of Insurance regulations1 mandate that short-term plans:
- Can charge premiums no more than three times higher for older adults than young adults.
- Can exclude coverage for preexisting conditions, although Colorado law defines them as conditions diagnosed, treated, or symptomatic in the last 12 months only.
- Cannot reject applicants based on their medical history.
- Must cover all state-mandated coverages, such as pregnancy, as well as all ACA essential health benefits, including prescription drugs and mental health coverage.
- May not last more than six months and cannot be renewed.
What Are Alternatives for Immediate Health Insurance in Colorado?
Short-term health plans aren’t available in Colorado, but you have other options, including these three:
- Colorado runs its own ACA health insurance exchange. It’s called Connect for Health Colorado. If you have had a life-changing event, such as losing an employer health plan, or moving to a new area, you may be eligible to apply during a Special Enrollment Period.2 You can sign up for an ACA plan for just a few months until other coverage kicks in if the timing works out.
- If you had coverage through an employer-sponsored plan, you may be able to continue coverage under COBRA. This option can be expensive, as you will have to pay the entire plan premium. It might be a good option if you need coverage while you wait for Medicare eligibility, for plan coverage with a new employer, or for Connect for Health Colorado’s Open Enrollment Period.3
- Health First Colorado is the state’s Medicaid program. It covers adults ages 19-64, children, and pregnant women who meet certain income guidelines. An adult with no dependents may make up to $1,428 per month and still qualify for coverage.4
No matter what plan you choose, make sure you understand your costs. In addition to the monthly premium, consider your out-of-pocket costs. These include copayments, coinsurance, and the plan’s deductible
How Does Short-Term Health Insurance Differ from Obamacare in Colorado?
With short-term plans, you can enroll at any time and be covered immediately. Monthly premiums for short-term plans are typically lower than what you would pay for an ACA-compliant plan without a premium subsidy.
Short-term plans are usually not required to cover essential health benefits that ACA plans cover, such as maternity care, preventive services, and prescription drugs. They also don’t usually cover pre-existing conditions. But In Colorado, short-term health plans must cover all state-mandated and ACA essential health benefits.
Colorado’s rules also impact an insurer’s ability to deny coverage for pre-existing conditions. If it’s been 12 months since you were diagnosed, treated, or had symptoms, the state does not consider your illness to be a pre-existing condition. Because of these regulations, no insurer offers short-term health plans in Colorado.
In the event that short-term plans become available in Colorado, they may be a good option if you:
- Don’t qualify for an ACA subsidy and need an affordable alternative.
- Are in relatively good health and don’t access healthcare services often.
- Are aging out of coverage on your parent’s plan. ·
- Need to fill a gap between employer-sponsored coverage and your next job.
- Are waiting to be eligible for Medicare coverage.
On the other hand, ACA-compliant plans are the best option if you:
- Have a health condition.
- Have a medical condition that requires you to see a healthcare provider regularly.
- Qualify for subsidies that make premiums more affordable.
Know the details
Make sure you understand your costs for any plan you choose. In addition to the premium, out-of-pocket costs include copayments, coinsurance, and the plan’s deductible.
Who Sells Short-Term Plans in Colorado?
Due to the state’s hefty coverage requirements for short-term plans, there are no insurance companies currently offering short-term health insurance policies in Colorado.
If you need temporary health coverage, start shopping for a medical plan that might fit your health needs and your budget. While short-term plans aren’t available in Colorado, insurance companies offer other options that could fill the gap. Even if they are a little more expensive, they may save you from medical expenses you didn’t anticipate, especially if you need emergency care. Coverage in the short term could save you a lot of money in the long run.