Misconceptions about short-term medical plans are common. While STM plans can provide quality benefits that meet a variety of budget needs, they fall outside of traditional healthcare coverage options, prompting your clients to have questions. The cost of healthcare continues to rise, and political scrutiny and legislative updates continue to impact the industry and your clients’ wallets. There is no better time to make sure your clients have a thorough understanding of their options so they can help to protect their health as well as the health of their loved ones and their finances.
STM plans, also called temporary health insurance, are medical plans that have a limited duration. They are designed to bridge gaps in healthcare coverage during a period of transition such as graduating from college or starting a new job. Here are 4 common misconceptions about short-term medical plans:
Misconception #1: Only a limited number of doctors accept short-term medical plans.
STM plans are accepted by many providers and facilities across the nation. If a client chooses to see an out-of-network provider, it could result in higher out-of-pocket costs. Some STM plans may provide for the services to be covered (depending on the plan) via a reimbursement, but the policyholder will pay upfront for and submit her/his own claim.
These plans often feature provider networks that ensure lower rates than providers who are outside of the network, but that doesn’t preclude your clients from choosing providers of their choice.
Just like with traditional major medical plans, clients with short-term medical coverage who choose to receive medical services outside of the featured network may incur higher out-of-pocket costs.
Help your clients know how to make the most of their benefits. This includes knowing how and where to access their member ID card, who to call with questions about benefits, who to call with questions about claims, and where to access their provider directory and pertinent details of their coverage.
Misconception #2: Only those who are young and in good health are good candidates for short-term medical coverage.
This level of coverage may fit the needs of clients who are:
- Transitioning between jobs
- Waiting for employer insurance to begin
- Graduating from college
- Rolling off parents’ coverage
- Waiting for Medicare coverage to become effective
You may have clients who are looking for healthcare options outside of Open Enrollment. Or you may have a client who is looking for coverage that includes preventive care for herself and her family before her new policy through her employer starts. While benefits may be limited, this level of coverage may suit such clients’ needs and help them tackle their healthcare realities. There are a variety of plans available, some of which may even be a good fit for clients who want to see providers of their choice.
Disclaimer: Short-term medical coverage is not intended to be a replacement or alternative to ACA or other major medical plans nor does it provide the minimum essential health benefits that are required and it won’t help to avoid the fee for not carrying health insurance. They can have exclusions and limitations, which may not make them a valid option for some clients.
Misconception #3: Short-term medical coverage is expensive and doesn’t provide quality coverage.
STM premiums are often lower than major medical premiums because they offer more limited and/or restricted benefits. The coverage provided by STM plans can provide a range of valuable insurance benefits for individuals and families such as:
- Preventive care and routine doctor visits
- Emergency care*
- Inpatient and outpatient surgery and hospital care*
Similar to major medical, your clients can enjoy added non-insurance benefits as well such as:
- Mobile access to board-certified doctors who can treat many common illnesses
- Patient advocacy service that can help navigate the world of healthcare and negotiate medical bills
- Prescription savings membership that can lower out-of-pocket costs
- Digital fitness tool to help track your wellness journey
However, the coverage provided by short-term medical plans does not include:
- Immediate benefits for hospital stays, surgery or anesthesia for conditions you already have
- Benefits for prescription drugs
STM plans do not have coverage requirements, so plans vary in what is covered. Review any plan details with a client prior to purchase. Additionally, STM does not cover pre-existing conditions. Applicants are subject to underwriting approval based on answers to medical questions. Coverage is limited to a time period of no longer than three months.
*Typically not covered for pre-existing conditions
Misconception #4: Short-term medical plans can help those enrolled avoid the Affordable Care Act’s tax penalty.
While STM coverage can be an affordable and quality option for your clients who are looking to help bridge the gap in their health coverage, it does not qualify as minimum essential coverage under the Affordable Care Act. That means that they are likely to face tax penalties. Your clients who are without minimum essential coverage for less than 3 months within a year and those who belong to certain groups are exempt from the penalty.
Because STM plans don’t have to adhere to ACA regulations, your clients have a range of plan options to choose from, including some with lower monthly rates than major medical plans. Current legislative reform attempts are expected to make room for more STM plan options.
Are you ready to expand your client offerings with short-term medical options?
Learn more today by:
Calling 877.376.5831 and selecting option 3