Over the last few years, there has been an increase in the promotion of short-term health insurance plans. While these may appear more affordable on the surface, they rarely offer good value in the long run. The problems associated with these plans often outweigh their benefits. It’s no wonder, then, that so many healthcare organizations are curious whether better patient payment solutions could resolve the issues.
What Is A Short-Term Insurance Plan?
Unlike a standard health insurance plan, these short-term plans only have a limited duration. The coverage they offer is up to a maximum of 364 days. It could even be as little as a couple months. One reason why short-term insurance plans are becoming more popular is their affordable price. When compared to full-coverage plans, they are generally much lower in cost. The most affordable short-term plans cost around 20 percent of the cheapest ACA-compliant health plans. Some are even lower. Unfortunately, the drawbacks associated with these plans mean the negatives outweigh the positives.
What Are the Problems Associated with Short-Term Insurance Plans?
While full coverage plans are ACA-compliant to protect the individual, short-term plans aren’t regulated. Since ACA rules do not apply, the plans may not always cover essential health benefits. Short-term health plans can cover any conditions they like. This means if you develop a medical problem, your insurance may not cover it.
Also, consumers are often turned down when they suffer from a pre-existing health problem. The plan may not cover conditions, such as HIV/AIDS, substance abuse problems, hepatitis, cancer or mental health disorders. Coverage is also often dropped when patients receive a medical diagnosis during their policy period. While some states prohibit short-term policies being sold that refuse coverage for pre-existing problems, others do not. This puts patients in a state of confusion.
Most short-term insurance plans usually cover major benefits, such as unexpected accidents or a hospitalization for an illness. However, coverage is still limited. In addition, the insured person must usually meet a deductible first. This may be high, and if convenient patient payment solutions are not in place, making payments can be difficult.
There are also usually limits placed on the number of visits to a physician during the coverage period. There will also be a dollar limit on the benefits the plan will cover. Some policies only pay out a maximum of $1,000 for a day spent in the hospital. Any charge over that amount is the responsibility of the patient. Since the cost associated with a three-day stay in the hospital is about $30,000, this explains why patients struggle to pay. Some plans even limit coverage on prescription drugs, with some policies failing to cover drugs, period.
The Expense of Coverage Shortfalls
One major problem associated with short-term health policies is that many have no provider network. This means there are no agreed price limits. Indemnity policies only reimburse patients up to the insurer’s set amount. Patients must then pay the difference in a Balancing Billing arrangement. This is usually extremely expensive.
A short-term policy could be suitable for those who are likely to stay healthy or who have no other options. However, for most people, they are not fit for their purpose. The entire point of health insurance is to protect against high bills should the patient become injured or ill. A short-term policy may be cheaper to buy. However, should a person become ill, the coverage is more expensive. Often, prohibitively so. Providers of healthcare services must, therefore, find ways to manage their practice patient payment acceptance options.
For patients who have no option other than a short-term policy, healthcare debt can be crippling. If they receive a diagnosis, the amount they need to pay is invariably very large. Healthcare providers, therefore, need to find better ways to receive those outstanding amounts. By putting in place convenient patient payment solutions, such as IPayX, a healthcare provider will likely receive a larger proportion of payments.