If you live in Indiana and need healthcare coverage quickly and for a short period of time, short-term health insurance may be right for you.
What Is Short-Term Health Insurance?
Short-term health insurance is designed to fill gaps in coverage when you’re transitioning from one plan of coverage to another. It also can help if you’re in a situation that prevents you from getting traditional health coverage. These situations include:
- You’re currently unemployed or between jobs.
- You’ve missed the regular enrollment period and aren’t eligible to apply during special enrollment periods.
- You no longer have coverage under your parent’s plan or you’re a recent college graduate in transition.
- You’re an employee without access to group benefits at your job or you’re a new employee waiting for your benefits to kick in.
Short-term health insurance, also known as temporary health insurance, limited-duration insurance or short-term medical is defined as less than 12 months and no longer than three years).
What Are Indiana’s Rules on Short-Term Health Insurance?
A federal rule that went into effect on October 2, 2018 defines short-term health insurance coverage as having an initial contract term of less than 12 months and lasting no more than 36 months.1 Prior to this change, the longest short-term health insurance could last was three months and it didn’t have to be renewable.
In July 2019, the Indiana General Assembly passed a complement to the federal law that allows short-term health insurance plans to renew up to 36 months. They can also be issued for 364 days or less and have an annual benefit limit of $2 million.2
How Much Do Short-Term Plans Cost in Indiana?
The cost of a plan varies depending on three things: your health (including any medical conditions you might have), who needs to be insured, and how long you need to be covered.
Most insurance plans involve four costs: premiums, deductibles, copayments and coinsurance.
A premium is the amount you pay for insurance each month for the duration of your coverage.
Your deductible is the amount you’ll need to pay in total before your healthcare plan starts paying the rest.
For example, if your annual deductible is $2,000, you’ll have to pay this amount out-of-pocket for most medical costs before the insurance company starts to contribute. Once you’ve reached your out-of-pocket deductible, you’ll typically begin only paying a copayment when you use services covered by your insurance.
Your copayment — also known as a copay — is a fixed amount you pay for covered services such as emergency room visits or specialist consultations.
Coinsurance is the percentage of a medical service you’re responsible for paying; your short-term insurance plan will cover the rest of the fee.
For instance, if your coinsurance is 30% and you have a medical procedure that costs $1,000, you are responsible for paying $300.
According to a search for policies on Pivot Health, plans for a 35-year-old woman living in Indianapolis start at $95.33 a month with a $20,000 deductible, 0% coinsurance and a maximum out-of-pocket expense of $20,000.
Is Short-Term Health Insurance in Indiana Right for Me?
If you live in Indiana and need coverage to get you through the next several months or so, a short-term insurance plan may be a good choice. Here’s a look at the pros and cons to help you decide:
- It’s more affordable. Short-term policies generally have lower premiums compared to Obamacare (Affordable Care Act plans), but they also come with higher deductibles, copays, and coinsurance.
- There are flexible enrollment options as you can enroll outside the normal enrollment period.
- If you’re relatively healthy, these plans are a good choice. Short-term health insurance will cover you for emergency care and visits with your primary care doctor and specialists, but the plan you choose may not include every “essential benefit” required by Affordable Care Act plans. There are 10 essential benefits defined by the ACA, and they are:
- Ambulatory patient services (outpatient services)
- Emergency services
- Maternity and newborn care
- Mental health and substance use disorder services, including behavioral health treatment
- Prescription drugs
- Rehabilitative and habilitative services (those that help patients acquire, maintain, or improve skills necessary for daily functioning) and devices
- Laboratory services
- Preventive and wellness services and chronic disease management
- Pediatric services, including oral and vision care
- Your plan may not cover preexisting conditions or medical conditions that require a lot of medical care. Indiana’s short-term health insurance plans do not require coverage of preexisting conditions or care for chronic medical conditions. This means that “these policies offer fewer covered benefits and consumer protections compared to plans that comply with all the Affordable Care Act (ACA) standards”.4
- Your plan may not offer “minimum essential coverage.” This can include maternity care, vision care, dental care, and mental health care, among other benefits. That’s why it’s so important to ensure that any plan you’re considering covers all your healthcare needs, as much as possible.
How Do You Buy a Short-Term Insurance Plan in Indiana?
There are several places you can go to search for a short-term insurance plan, although unlike other healthcare plans, you can’t buy it through Healthcare.gov or another marketplace. Therefore, you’ll have to buy directly from a private health insurance company.5
While the Affordable Care Act (Obamacare) and COBRA can provide health coverage for those who may not qualify for other health insurance plans, these plans still may not be ideal for everyone. Short-term health insurance plans offered to people who live in Indiana may not give you all the coverage you’d want at an ideal cost, but these plans can be a good temporary safety net for medical care when you really need it.