Short term insurance, also called "temporary" or "gap" coverage, is very real. The only difference between a "regular" policy and short term coverage is that short term plans have maximum lifespans: some allow only six months of coverage in any 12 month period, others allow you to apply for up to 12 continuous months at a time, and a few will let you re-apply every six months for unlimited periods of time. You can go from carrier to carrier. These plans are fairly inexpensive, and cover no routine services or preexisting conditions. (You cannot get a short term plan if you or your spouse are pregnant.)

Minimum coverage is $1,000,000, with deductibles ranging form $250 to $2500 (the higher the deductible the lower the premium), and usually a choice of 80/20 or 50/50 coinsurance. These are major medical plans and, like many major medical, do not offer coverage for mental health, maternity or routine check-ups. You can go to any doctor, anywhere in the United States, for medical treatment. Some short term plans are affiliated with PPO networks, though most allow you to use any doctor, anywhere.

As with any health insurance policy, claims payments when using the type of plan that lets you go to any doctor, are based on UCR - meaning "usual customary and reasonable." What this means is if you have a cold and the doctor charges you $110 for the visit, and the UCR is $90, the carrier will base it's payment on the $90 and you will be responsible for the rest - even if you have an 80/20 plan. That carrier is paying it's portion of the obligation based on the UCR rate, not necessarily on what the doctor actually charged.  And, of course, the 80/20 coinsurance guideline doesn't kick in until you have met your deductible. The deductible must be met before the carrier pays anything.

Short term plans do not cover preexisting conditions  – by definition, short term products define preexisting as anything for which the applicant has seen a doctor, received treatment or medication, in the last three to five years (some application will ask "Have you ever...."). All short term plans ask medical questions. Without exception, they ask if the applicant has been treated for cancer, diabetes, stroke, or heart disorders (usually in the last three to five years). If the answer is YES, the coverage cannot be issued. More than half the short term plans ask if the applicant has ever been declined coverage due to health reasons; a YES answer would result in a decline of short term coverage, too. However, several do NOT ask about declines. All short term plans ask if an applicant is currently pregnant or has been diagnosed with any auto-immune disorders – YES answers to these would result in a decline of coverage. Some short term plans have height and weight restrictions.

Short term plans do not have waivers, riders or exclusions of coverage; they are meant to protect the applicant against the unexpected illness or injury for the time period for which they have made application.

Short term plans DO pay off. One of our clients was diagnosed with a fast-metastasizing breast cancer at the age of 39; she had been on the plan just two months when the diagnosis was made, and the cancer, due to its deep-ductal location, could only be detected by a mammogram. The carrier paid over $65,000 for her surgery and full reconstruction. Another client, nearing the end of a six month period, suffered a heart attack and the carrier paid for a triple by-pass. The client had proof this was not a preexisting condition: an EKG and physical just four months before taking out the short term plan showed him in excellent health, there were no warning signs.

A short term plan can be paid for in full for the time requested (up to six months at a time) for a significant discount or paid for monthly, for a higher premium. Most will allow for credit card billing or monthly billing with a check. Most plans paid six months at a time offer no refund on unused months, though a few do.

Some plans offer a discount drug card (average discount 10-15% on brand name, 35-45% on generic). This card can be used on any prescription, new or preexisting.

Maximum put-of-pocket expense for a covered condition on a short term plan would be the deductible plus $1,000, same as with most major medical plans.

The short term plan is ideal for: students between college and job, workers between jobs and group coverage... someone who just lost their insurance, for whatever reason, and is waiting out the often lengthy underwriting of a new plan or a waiting period for a group plan... someone who earns too much for AHCCCS but can't afford a full-featured plan, someone who is overweight but in otherwise reasonable health (all regular carriers use height and weight tables; few short term plans ask)... someone who is a year from Medicare and in excellent health (they like the low rates), someone who has had preexisting conditions for which regular carriers will decline an application altogether (an example would be someone who had cancer six years ago - most regular insurance carriers for individual and family plans have a 7-10 year treatment-free requirement).

There are over 200 ailments which can result in a decline from a regular carrier but which, while not covered by the short term plan, would still allow that person to get a large major medical health plan that would cover anything new which might occur.

Short term coverage is very real, very viable and an excellent alternative when a regular plan is not feasible, for whatever reason. Do not overlook this type of plan if you find yourself uninsurable due to health, cost or lack of employment.