Beware of Short-Term Health Insurance (STLDI)

August 11, 2020

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As the coronavirus outbreak continues, some companies are predicting higher health insurance premiums for 2021. With open enrollment coming up in the next few months and millions of Americans now without a job, you may be looking for a lower monthly premium. But beware not to lunge towards the short-term health insurance option.  Originally set up to fill gaps in health insurance for job changers and students, Short-term, limited-duration insurance (STLDI) may seem like a good investment because of the lower premium and look like it covers everything in your Affordable Care Act (ACA) approved health plan. But it doesn't. Short-term health insurance doesn’t have to offer coverage for the ACA’s essential benefits like preventative care, mental health coverage, or prescription drugs. STLDI plans may also have annual dollar limits or lifetime benefit caps, and they may exclude coverage for pre-existing conditions. You could spend a lot more to treat a newly diagnosed condition with STLDI compared to an ACA-compliant plan. What’s worse, your STLDI doesn’t have to renew your policy after a diagnosis, so you could lose your health insurance when it’s time to enroll again. If you are unemployed and concerned about health coverage, visit and shop for plans in the health insurance marketplace. You may qualify for a special enrollment period due to job loss—along with cost-sharing reductions—which could make the plan a lot more affordable.

SOURCE: Two Cents

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