What You Need to Know
In Maryland, short-term health plans are limited to less than 3 months and are non-renewable.
Short-term health plans usually do not cover preexisting conditions or the 10 essential benefits that Affordable Care Act (ACA) plans cover.
In general, you’ll pay lower monthly premiums for a short-term plan than for an ACA plan without a subsidy.
What is Maryland Short-Term Health Insurance?
For Maryland residents experiencing a gap in coverage, going without health insurance can be risky. A sudden illness or injury can jeopardize your health and finances.
Short-term health insurance can help you bridge a gap caused by a job change or other life event. These plans provide temporary health coverage that may be less expensive than plans offered through the ACA Marketplace.
But look closely at the plan details. You may find limited coverage and higher out-of-pocket costs.
Who Should Buy Short-Term Plans in Maryland?
There are several factors to consider when determining whether a Maryland short-term health policy is right for you:
- Affordability: If you don’t qualify for a subsidy, short-terms plans are often more affordable than ACA plans. However, lower monthly premiums generally mean higher out-of-pocket costs when you need to access medical care.
- Enrollment: Unlike ACA plans that only allow you to sign up during certain periods, you can purchase a short-term policy at any time. Keep in mind that when your short-term policy ends, you will not qualify for an ACA special enrollment period. If you want to enroll in an ACA plan, you’ll have to wait until the next Open Enrollment period, which runs from November 1 to January 15 each year.
- Your Health Status: Short-term plans are best suited for the young and healthy. They are not required to cover preexisting conditions or the ACA’s 10 essential benefits. Services such as maternity care, mental health care, and prescription drugs may not be covered.1
- Life Events: Short-term health coverage can help bridge gaps that occur during life-changing events, such as:
- Changing jobs
- Turning 26 and aging off your parents’ plan
- Retiring before age 65
- Losing a spouse’s coverage due to a divorce
Under some circumstances, a short-term policy may not be a good choice. For example, if you have medical conditions or need the essential benefits of the ACA, you should consider other options.
In summary, the advantages and disadvantages of short-term plans are:
- Short-term insurance is a temporary option for bridging gaps in health coverage.
- A short-term plan can protect you from unexpected health expenses.
- If you are relatively healthy, a short-term plan may be a cheaper option than an ACA plan.
- Short-term plans have higher out-of-pocket costs than ACA plans.
- Preexisting conditions are generally not covered
- Short-term plans are not required to cover the 10 essential health benefits required under the ACA.
How Much Are Maryland Short-Term Plans?
When comparing health insurance plans, it’s important to compare all costs, including:
- Premiums — your monthly payment for your health plan.
- Deductibles — what you pay before your insurance starts to share the cost of your medical care.
- Coinsurance — a percentage that you pay after you’ve met your deductible.
- Copayments — a fixed fee for a covered service that you pay after you’ve met your deductible. Copays vary by the type of visit, service, or provider.
What Are Rules Governing Short-Term Plans in Maryland?
Federal guidelines allow short-term health insurance carriers to sell plans with terms of less than 12 months, renewable up to 36 months.2 Maryland regulations are more restrictive. Short-term plans must be less than 3 months.3 After 3 months, you cannot renew the policy, but you can re-apply for a new one.
Keep in mind that each time you apply for a short-term plan, you will be subject to medical underwriting. This means the insurance carrier will evaluate your medical history to determine whether they will cover you.
Who Sells Short-Term Plans in Maryland?
Short-term health insurance carriers that offer plans in Maryland include:
- Freedom Life Insurance Company of America
- Independence American Insurance Company
- UnitedHealthcare (Golden Rule Insurance Company)
Maryland residents have many health insurance options. If you’re experiencing a gap in your health coverage, a short-term plan may be a good choice.
Before you sign up though, take some time to compare the costs and coverage of all your options. By doing so, you’ll avoid any surprises when it comes time to access medical care.