Wednesday, January 15, 2020

A Few Short (Term) Words

I have mixed feelings about using Short Term Medical plans for long term needs:

That is, they were originally developed for limited durations, such as group plan probation periods, that kind of thing. And, for a long time, the maximum policy period was generally 180 days (6 months). A while back, the Feds clamped down on even that, limiting them to no more than 90 days (3 months).

Recently, that cap was lifted, and a number of carriers now offer 360 or even 364 day plans (essentially a year).

But what happens at the end of that policy if one has developed a medical issue?

STM plans, unlike their ACA counterparts, are underwritten, and exclude any pre-existing conditions. This means they're generally a lot less expensive, and can offer a lot more benefit design options. But it also means that if, for example, one develops asthma during one policy term, then that condition will be excluded if/when a new policy is written; plans can be re-written, but not "renewed."

One of the cooler things I've seen lately has been a feature offered by at least one carrier (I'm sure there are others, just haven't had a need to look): concurrent plans.

That is, one can write a 364-day plan, and when that's up, can re-write  a second one, and anything that cropped up under the first plan is not considered pre-ex for the second. Nice.

The carrier that I've been using, Pivot Health, offers this option with a fairly modest extra "processing fee" (about $20 per policy). I like that a lot. My only real quibble with them is that they limit their policy maximum to $1 million. That's not a deal-breaker, but UHC (for example) offers a $2 million policy maximum.

Oh well, can't have everything.
blog comments powered by Disqus