Gap between COBRA and ACA

[EastWest Gal]

My COBRA ends 11/30/20. Our state (PA) is launching it's own ACA portal in November, to start coverage on 1/1/21. I am thinking of a short term health insurance plan to bridge that one month gap. The cost difference is at least $1300 for the cheapest bronze plan. We have no need to use the insurance except for unexpected illness or injury. I don't know much about short term insurance though. Am I missing something?

 

[RockyMtn]

I believe you can go on ACA if your Cobra runs out. It's a qualified event that opens a special enrollment period. Even if just for a month.

 

[PaunchyPirate]

RockyMtn is correct. You should be able to buy one month of coverage from healthcare.gov if you want. You can do that now, since your coverage is ending in the next 60 days. And then you would sign up again for 2021 on November 1 when pennie.com goes live.

Or, as you said, you probably can buy a short term policy off the exchange. Just be sure to understand what it will not cover. I don’t believe they have to cover everything an ACA plan does and they usually have limits on amount paid. At least the one I purchased years ago did.

 

[MBSC]

I am thinking of a short term health insurance plan to bridge that one month gap. The cost difference is at least $1300 for the cheapest bronze plan.

A Short-Term Medical (STM) plan would be appropriate in this situation if you are healthy. They are not ACA-compliant, meaning they have medical underwriting and exclude pre-existing conditions. They do a good job of paying injury claims but can be a little sketchy with certain illnesses. Read the exclusions list to be sure you understand what is not covered. Someone may post that STMs are not available in all states but I see no restrictions for PA (link).

They use national PPO networks in case you travel over the holidays. Try to stick with well-known STMs like Golden Rule by UHC or National General. A good place to start is ehealthinsurance.com.

Otherwise, you can pay the additional $1300 for a one month ACA plan from the federal marketplace at HealthCare.gov. You can also buy ACA plans directly from the insurer when you do not qualify for subsidies. Some insurers have off-exchange ACA plans that are a little less expensive than the on-exchange version.

 

[EastWest Gal]

I know a lot about the ACA, I've enrolled in the past due to losing coverage when I went part time. DS has been on it for years. I know I could pay $1700 for one month, or $400 for one month on a short term plan, which I probably won't use at all. I plan on doing a Roth conversion this year, and thus will definitely not be eligible for a subsidy. For the next 3 years, we'll be reporting farm losses, which should put us under the cliff, at least in 2021 and 2023. Exclusions? DH and I will get 90 day refills in November-we each take one med. And no, I won't be pregnant.

I know so little about short term plans, so I was wondering if others had bad experiences with them. Also, if anyone knows where I can get reliable information-einsurance for example, or healthsherpa. The latter seems focused on ACA insurance.

My question is only about pitfalls with short term health insurance.

 

[Sarah S]

I don’t have recent experience. Years ago I had a policy that I bought individually that had a pre existing clause. Because I had an isolated high blood pressure reading ( that was never replicated and was followed up) they had an exclusion that included not just hypertension but all things cardiovascular. My point is that , depending on the reasons you have the meds and on anything else that is in your record, you MIGHT find that some of the catastrophes you want to insure against end up excluded Hopefully you can find out whether that is the case in time to pick up an ACA policy if needed.

 

[pb4uski]

In normal times, I would think that you could "get away" with using short-term health insurance instead of ACA insurance for that gap month.

In a pandemic, I'm less sure that it is a good idea... but you might well be able to "get away" with it.

 

[EastWest Gal]

I researched short term insurance and called one of the big companies. They actually list hypertension as a condition that DOES NOT disqualify you. I got a quote and added a hospitalization add on, which pays $1000/day for hospitalization for up to 30 days. It can cover the entire deductible in the event of a hospitalization, which is amazing. The plan covers 100% after the deductible. We won't have any routine medical needs that month.

I'm not sure why a pandemic would make a difference. I'll have ACA insurance starting January 1st, hopefully can get a subsidy rather than get a giant tax refund in 2022. Full pre-existing condition coverage then, of course. I'll save about $1200 in insurance costs.

It seems few here have had experience with short term insurance, based on the responses. But thanks for trying to help.

 

[pb4uski]

....I'm not sure why a pandemic would make a difference. ...

A golf buddy got covid... was hospitalized and then in the ICU... no idea what his hospital bill was but I'm sure it was a lot ... probably a lot more than $1,000/day, especially when he was in the ICU.

 

[EastWest Gal]

The insurance (major company) will pay 100% after deductible. The $1000/day will pay the deductible and beyond. I think you missed the first paragraph of my post.

 

[pb4uski]

You're right... I missed that.

 

[EastWest Gal]

Update:

Well, I got a quote on short-term insurance and signed up. When I got the paperwork, it said that for illness coverage doesn't start until 12/6. So, it's a no-go. It may be short term, but it sure isn't insurance.

I'll be cancelling the policy and signing up for the ACA. Healthcare.gov in December, PA's new exchange for January. Even if I signed up to start 5 days earlier, if I get COVID or have an illness this month, they'll treat it like a pre-existing condition. Not worth saving $1000 to potentially lose 100x as much.