Short Term Health Insurance Is a Great Solution During These Uncertain Times
After six years of the complex Affordable Care Act (ACA, also called Obamacare) being rolled out in pieces and parts, the Republicans, who now control Congress and hold the Presidency, have their first real opportunity to make significant changes in the law.
During this time, many people are wondering what to do:
- Should they enroll in an Obamacare plan on the exchange?
- Should they wait it out if they are relatively healthy?
- Should they look for an alternative until the dust settles?
This is a particularly good time to consider purchasing a short term health insurance plan.
Short term medical or temporary health insurance is designed to provide you with comprehensive coverage that costs about half of the standard premiums of ACA/Obamacare health insurance plans. Lower cost, greater flexibility and coverage that may be more in line with your needs. Sounds like a perfect alternative, especially during these uncertain times.
How will “repeal and replace” affect you? It will not be an easy task, and there are many ideas on what should be, could be and will be done to either dismantle it or revamp it to a large extent. This post will explore those points, as well as explaining the advantages of short term health insurance.
Pivot Health’ Short Term Medical: A Solution for Current Times
Pivot Health’s short term medical plan may be the answer you are looking for.
- $1 million maximum benefit per coverage period
- Coverage for hospitalization, surgery, medical services and treatment, doctor office visits and more
- Benefits for extended care facilities, home health care and mental health services
- Local ambulance or air transport
- Some plans in this product series also lower your out-of-pocket expenses with physician visit copayments and prescription drug coverage
- There are a wide range of deductible options
No required medical networks
This plan provides you the freedom to use any doctor or hospital and still have your coverage apply.
Pivot Health’s short term health insurance plans generally cost about half as much as individual health insurance plans.
Short term medical insurance does not meet the ACA definition for health insurance coverage required by the ACA’s individual mandate. However, with changes coming, the individual mandate is one aspect of the ACA that may either go away or be significantly altered.
Repeal and Replace Is a Complex Operation
There is no easy way to repeal and replace the ACA. Most components of the massive law were implemented in distinct pieces over the course of the past six years. And, it is a massive law, as it touches on individuals, employers, IRS codes and regulations, Department of Labor operations and many other parts of the government and the nation’s economy.
The fact that the law already has affected most people in one way or another and the way the law was written and passed make it a difficult task to dismantle.
There are many views and strategies for repeal and replace, but as of mid-January 2017, there was not one definite direction determined to accomplish this.
Most people agree that the actions will take two swipes:
- Repeal the current law, or repeal certain portions of the current law, perhaps by defunding them.
- Replace the current law with a new law that will still have the same objectives of providing access to health insurance for most Americans.
It seems unlikely that “repeal and replace” could be accomplished in one action by Congress. Even if that were possible, right now, there is still much discussion on the specifics of what the replacement would entail.
President Trump’s First Executive Order Could Impact You
One indication that President Trump is serious about fixing Obamacare is his action immediately following his inauguration on January 20, 2017.
President Trump’s first executive order, signed within hours of his swearing-in at the Capitol, is designed to set the stage for beginning the dismantling of the ACA.
This executive order in and of itself does not end Obamacare. However, it does direct federal agencies that are charged with administering the ACA to waive or delay provisions of the ACA that are “deemed a burden” to individuals, health care providers, insurance companies and other entities.
Some people have interpreted this executive order to mean, for example, that the IRS should not enforce, or should minimize enforcement, of the penalty for individuals who do not have ACA-compliant health insurance. If this is the case, then that opens up much wider options for individuals on the type of health insurance coverage they select.
If the individual mandate and penalty go away, then health insurance plans that are the same as or are patterned after the benefit structure of short term health insurance may become much more prevalent, especially since the cost is about half of the current ACA-compliant health plans. Without the risk of an individual mandate penalty hanging over their heads, it will be easier for consumers to consider and purchase health plans that better fit their needs and budgets.
Republicans Have a Number of Proposals to Consider
While the Republican leadership in Washington is very committed and optimistic about their strategy to repeal and replace the ACA, the specifics are still up in the air.
In early January 2017, even before President Trump’s inauguration, Republicans in Congress began unveiling legislation to repeal and replace the ACA.
Even so, the details of the final plan have not yet been decided or revealed. A number of Republican leaders in Washington have plans and strategies they are promoting.
Mike Pence, now the Vice President, said in early January that the party would be pulling from a number of ideas from Republican party members in writing the replacement plan. “Republicans have been offering those ideas again and again literally every year since Obamacare was first signed into law,” Pence told reporters.
It has been widely reported that President Trump and the Republican-led Congress intend to keep some aspects of the ACA, such as no pre-existing condition restrictions and allowing adult children up to age 26 to be covered on a parent’s health insurance.
The pieces of the ACA that may be on the chopping block include the individual mandate, the employer mandate and at least some of the taxes, fees and penalties that make up a large part of ACA administration. At the same time, Republicans will be developing new avenues for developing revenue that will help pay for what ultimately remains within health care reform.
Replacement of Obamacare Will Take Time
Some forecasters have said that it will take at least two years to effectively repeal and replace the ACA. This is based on the concept of repealing the ACA through a process called “budget reconciliation,” which can be accomplished with a simple majority (more than 50%) of the Senate. Most legislation requires a 60-seat majority in the Senate to avoid a filibuster which can delay any legislative process.
This reconciliation process can be used to repeal tax provisions of the ACA, such as federal subsidies for those who purchase coverage on the exchanges. It also would affect other parts of the ACA related to federal spending.
If the reconciliation tactic is successfully used, Congress would still need to draft and pass legislation to replace the ACA. Some think that it would be best to wait until after the 2018 elections, when Republicans think they will be able to achieve a larger Senate majority. However, most recently, there has been more pressure to approve repeal and replacement either simultaneously or replacement shortly after repeal.
The dilemma for Republicans is to accomplish the changes in a way that will not severely disadvantage the millions who are currently insured on Obamacare health plans, since that would be a problem politically.
This is one reason that it is expected to take at least two years to make the transition to a new system of health care reform.
Insurers Will Need Time to Develop New Insurance Plans
What is probably less understood by many consumers is the time it takes to develop and bring to market a health insurance plan.
One of the primary reasons that a change in Obamacare cannot be accomplished quickly is that the insurance plans for 2018 have already been planned and developed.
It requires as much as 18 months to bring a health insurance plan to market, and that is after the insurers are provided the details on what will be required, what will be allowed and what will not be allowed. This process is very detailed and relies on a great deal of data and details, including collecting data, making decisions about participation, medical networks, strategies for medical management and cost containment, development of marketing materials and preparation of customer service systems.
When the government makes big changes in regulations and requirements, insurance companies have to go back to the drawing board and, in effect, start from scratch.
In addition to plan design, the insurance companies also must determine premium rates to charge. For 2018 premium rates, for example, actuaries normally would begin assembling data on 2016 results in early 2017. Under current rules, May 3 is the deadline for submitting rates for regulatory review for the following year, so May 3, 2017, would be the deadline to submit rates for insurance plans to be sold for 2018.
What Should You Do During This Uncertain Time?
Although there are many uncertainties at the present time, there is one certainty: you and your family need health insurance protection to guard against financial losses if one or more of you experience an accident or serious illness.
There are many options you can consider, and short term health insurance is one of the more economical choices you have.
Pivot Health’s Short Term Medical plans offer a wide range of coverage and options to meet the needs and budget of your family. In addition to the valuable insurance protection coverage, these plans also provide you savings through a number of non-insurance savings features, including:
- Telehealth doctor consultations
- 15% – 30% off eye care, including exams, contacts and eyeglasses
- Up to 70% savings on prescription drugs at over 66,000 pharmacies across the country
No matter what you choose to do, the best advice is not to wait to see what happens with the repeal and replace strategy, since the result of this action will likely not take effect for at least a couple of years.