The U.S. economy posted a 3% growth rate for the third quarter of 2017, marking the first time in three years that the economy grew 3% or more in back-to-back quarters, according to the Commerce Department. Economists had expected an economic slowdown, accounting for significant property damage and job losses resulting from Hurricanes Harvey, Irma and Maria. But increased consumer spending, along with exports, imports and long-term project business spending, contributed to the third quarter’s solid growth rate.
With the good news of a growing economy and lower unemployment rate, however, comes the bad news for some families that as their wages rise, they may no longer qualify for government-sponsored subsidies to help pay for their Obamacare marketplace exchange coverage. Estimates are that between six to nine million Americans pay the entire cost of their exchange plans with no premium assistance. And as health care costs continue to skyrocket, many are now struggling to pay for health insurance. Rather than forgoing coverage completely, a growing number of individuals are turning to more affordable options, such as short term medical, zero deductible plans, and even purchasing individual insurance plans off the marketplace exchange.
Short Term Health Insurance Plans
Healthy individuals and families often find that short term health insurance, also called short term medical, is a cost-effective insurance choice until a permanent health insurance solution becomes available. This type of plan is designed to provide benefits comparable to coverage offered by marketplace exchange plans for a designated period of time and may meet your needs if you:
- Missed the annual open enrollment period
- Are temporarily unemployed
- Lost coverage from your parents’ plan
- Are waiting for your employer-sponsored health care benefits to begin
- Want a different choice than COBRA
- Don’t qualify for a special enrollment to purchase insurance through the marketplace
Short Term Medical Benefits
With a Pivot Health short term medical plan, you’ll receive benefits such as:
- A range of deductible choices, from $1,000 to $10,000, plus choices for out-of-pocket maximum amounts, to meet your budget
- Affordable 20% coinsurance amount, and flexibility to choose copayment amounts
- Up to $1,000,000 in benefits per coverage period
- Hospitalization, surgery and medical services coverage
- Physical therapy
- Mental health services
- Home health care and extended care facility
- On select plans, separate prescription drug benefits and copays on physician visits
- Non-insurance benefits, including discounts on vision care services and products, and a prescription drug savings card for use at pharmacies nationwide
- Access to 24/7 telemedicine consultations, so you can skip the waiting room and connect with a doctor at your convenience
If finances are a priority in your household, you’ll appreciate how much you’ll save by purchasing short term health insurance rather than a major medical plan purchased on the exchange. Your premium rate might even be as low as $50 per month, based on your benefits needs and age.
Length of Coverage
Because short term medical plans are designed to provide coverage for specific periods of time, federal regulations currently stipulate that these plans may provide up to 90 days of coverage per certificate of insurance. However, a recent executive order by the Trump administration may extend that period for nearly a full year per certificate in the future.
Until that time, you may still be able to apply for and purchase up to four back-to-back short term health coverage terms at one time through Pivot Health, depending on your needs and state’s regulations. By purchasing back-to-back certificates during your initial application, you won’t need to requalify at any point during your coverage period. In fact, you may even be able to extend your short term medical coverage for almost two years. That’s because after your initial policies expire, many states allow you to purchase up to four additional consecutive certificates.
You may start your coverage anywhere from 24 hours up to 60 days after applying, and may cancel your coverage at any time, with no penalty. To ensure you’re completely satisfied with your coverage, Pivot Health even offers a 10-day “free look” period. Should you purchase a plan and cancel within the first 10 days – and you haven’t filed any claims – you’ll receive a full refund of your premium.
Visit Any Health Care Provider of Your Choice
Unlike exchange plans which have restrictive provider networks, Pivot Health’s short term medical plans have no such networks. This feature offers you the freedom to visit any health care provider you want, with no concern that benefits will be paid differently for “in-network” providers than for “out-of-network” providers.
Zero Deductible Plans
A zero deductible plan can potentially be another good coverage option as an alternative to traditional health insurance or a temporary option until you can afford a more permanent health insurance solution. This type of plan has no deductible or coinsurance. You receive “first dollar” coverage, which means that the plan pays you a fixed dollar cash payment as soon as you incur a medical bill.
With PivotCare Elite zero deductible plans, you have cash benefits triggered by typical health services related to an illness or injury, such as trips to your doctor’s office, visits to the emergency room, lab tests, X-rays and MRIs, hospital stays, surgeries and anesthesia, and even childhood immunizations.
Each PivotCare Elite plan provides:
- Set dollar amount payments when you receive specified types of health services, whether you visit an in- or out-of-network provider
- Critical illness coverage, to provide you extra financial protection (in addition to the plan’s daily cash benefits), for catastrophic medical emergencies, such as stroke, heart attack, invasive cancer and end-stage kidney failure
- Fracture, burn and dislocation benefits
- A discount prescription drug card
- Benefits for ground and air ambulance services
- Coverage for mental health and substance abuse care
- Accidental death and life insurance benefits
PivotCare Plan Options and Network Savings
Depending on your benefit and budget needs, you may choose from five different PivotCare Elite zero deductible plan options, which offer varying coverage levels. As an added bonus, PivotCare participates in the First Health Preferred Provider Organization (PPO) Network, which includes more than 5,000 hospitals, more than 90,000 medical facilities and over 550,000 professional medical providers throughout the country. You are not required to use a provider or facility within the First Health network. However, if you choose to do so, you receive an immediate discount on your medical services.
Be sure to check the PivotCare materials for specific policy details, as specific benefit amounts vary among states, depending on each state’s regulations.
Exchange Plan Premium Costs Soaring in 2018
Individuals who continue to qualify for government subsidies, in either the form of premium tax credits and/or cost-sharing reduction (CSR) subsidies, will not experience a significant premium increase for 2018. However, consumers who don’t receive any type of government subsidy may be stunned to discover that premiums for silver-level exchange plans have increased significantly. On average across the country, rates are rising by 29%-30%, with some states experiencing even higher increases, such as a 58 percent jump in Virginia, and a 69 percent rate hike in Iowa.
While medical inflation and claim costs play a role in the rising rates, so too does the Trump administration’s recent decision to end cost-sharing reduction reimbursement payments to insurers. Since the inception of the Affordable Care Act, the government has made monthly reimbursement payments to insurers that offer reduced premiums to low-income Americans enrolling in silver-level plans on the exchange. For 2017, the payments totaled nearly $7 billion.
During the months that Congress debated repealing or significantly reforming the Affordable Care Act, the Trump administration warned that it would end the reimbursement payments if Congress failed to pass repeal or reform legislation. To compensate for the potential loss of those payments, insurers built in significant premium adjustments to the silver plans they offer on the exchange. In mid-October of 2017, the administration announced that it would immediately stop the reimbursement payments. Although 18 states and the District of Columbia quickly responded by filing a lawsuit to force the administration to make the payments, the judge in the case denied the request, as insurance companies had already built in premium rate adjustments to cover their reimbursement payment losses.
Insurers also factored into their 2018 exchange plan premium hikes the possibility that the Trump administration may end the Obamacare individual mandate penalty. The administration has encouraged Congress to repeal the penalty, and insurers are concerned that this move will encourage young, healthy individuals to drop their exchange plans and instead purchase less costly plans such as short term medical.
Although specific premium rates vary by state, this pie chart [below] shows which factors insurers considered when calculating the average rate increase for silver plans offered on the exchange in 2018. Medical inflation, claims experience and insurance administrative costs comprised about 12% of the nation’s average 29%-30% rate increase, while the CSR reimbursement compensation and potential individual mandate repeal factors comprised the remaining 17%.
Affordable Alternatives to Obamacare
If you don’t receive premium subsidies to help pay for exchange coverage, it’s well worth your time to research alternative insurance options. Short term medical insurance and zero deductible plans are solutions that may work well for your benefit needs and budget.