There are many reasons why you may find yourself without health insurance prior to becoming eligible for Medicare. This could include early retirement, losing your job, or losing eligibility as someone’s dependent. If you lose your employer-sponsored health insurance, you may be entitled to continue coverage through COBRA if your employer meets certain requirements. Or, depending on your financial situation, you may be eligible for Medicaid. Also, if you get a new job, you might be eligible for insurance under that employer’s plan. Your other option is to enroll in either an ACA plan or a short-term medical plan.
You can determine if you need coverage by how often you need health care if you have chronic health issues, and what you can afford to pay for insurance.
The Affordable Care Act (ACA), also known as Obamacare, created the ability for individuals to buy insurance coverage through a Marketplace. Specific rules apply for when someone can enroll in an ACA plan. The open enrollment period typically runs from around November 1 through December 15 each year. There are also certain Qualifying Life Events that will trigger a Special Enrollment Period of 60 days. These events include getting married, having or adopting a child, losing coverage through your employer, or a loss in coverage due to a divorce, legal separation, or death. If you miss Open Enrollment and you do not have a Qualifying Life Event that allows for a Special Enrollment Period, you will not be able to enroll in an ACA plan.
ACA plans are subject to federal regulations that mandate minimum essential coverage. This means that ACA plans must cover things like maternity care and mental health, and they cannot deny coverage or penalize someone for having a pre-existing condition. ACA plans tend to be more expensive than short-term medical plans because they provide richer coverage and cannot turn you away based on your health.
Short-term medical plans offer much more flexibility than ACA plans. You can generally enroll at any time and you could get coverage as soon as the following day. Plans range in length from 1 to 12 months and, once the plan period ends, you can usually start another plan. These plans can typically be dropped at any time without a penalty. Short-term medical plans also have lower premiums than ACA plans.
Because short-term medical plans are not mandated to adhere to ACA guidelines, they do not have to accept everyone who applies. There could be a medical exam or lengthy questionnaire and someone could be turned away or services could be excluded due to pre-existing conditions. Also, these plans can choose what types of expenses they wish to cover, so it’s important to fully understand what benefits are included prior to enrolling.
If you’re looking for health insurance to bridge the gap before you’re eligible for Medicare, we may be able to help you sort through the options. Contact us to learn more.