Temporary Health Insurance Coverage

Being without health insurance can be one of the scariest aspects of losing your job or no longer being eligible for coverage under a spouse or parent's plan. Temporary health insurance policies can give you basic coverage for a limited time, protecting you from high medical bills and gaps in coverage.

Definition

• Temporary or short-term health insurance policies protect you for a pre-determined length of time. Policies, available for periods as short as a few months to as long as three years, provide basic medical coverage for routine medical care, emergency care, prescription drugs, hospitalization and sometimes mental health care.

Qualifying

• One of the drawbacks of temporary health insurance is it is typically an option only for those without pre-existing conditions. Individuals with medical conditions requiring frequent visits to their family doctor or to specialists, or who require expensive maintenance prescription medications, may find it difficult to purchase short-term health insurance. Short-term policies are for generally healthy people who need stopgap coverage between jobs or between losing coverage under a parent or spouse's plan and qualifying for their own coverage through a new employer.

Costs

• The cost of temporary health insurance is one of the most appealing aspects of this coverage. The fact that insurers gear short-term health insurance toward healthy individuals means premiums are low. Insure.com estimates that a healthy, single male nonsmoker under the age of 30 would pay about $150 per month for short-term health insurance, while a healthy, single female nonsmoker can get coverage for around $140 a month. Those over age 30 may find their premiums slightly higher.

Advantages

• Perhaps the biggest advantage of temporary health insurance is it provides coverage for a reasonable price that can protect you from high medical bills resulting from a catastrophic illness or injury. Unlike most group plans, you can pick any doctor or hospital you choose with temporary health plans, and some will even cover preventative health care such as mammograms and pelvic exams.

  One of the best aspects of temporary health insurance is that some plans will issue a "certificate of creditable coverage" you can present to your next health insurer. If you have had continuous coverage, temporary health insurance can provide gap coverage that guarantees your next group plan must cover any pre-existing conditions, including those diagnosed while on the short-term plan.

Disadvantages

• While temporary health insurance has its benefits, it also has drawbacks making it unsuitable for some individuals. The biggest drawback is that most temporary plans will not provide coverage for pre-existing conditions. While the insurer may extend coverage to individuals with existing health problems, the policy will not cover the conditions themselves. Coverage often comes with other exclusions, including dental or vision benefits and pregnancy and childbirth care. If your doctor diagnoses a serious condition that results in high claims during temporary coverage, the insurer may deny a renewal of your policy. Also, the company may not renew your policy beyond a designated time.