Should You Recommend Medicare Short-Term Care Plans to Your Clients?
As agents, we’re always trying to match the right plan with the right client. Normally, these are Medicare or Advantage Plans. But occasionally, you’ll meet a prospective client who hasn’t yet aged-in and needs temporary coverage until they qualify. For them, knowing what Medicare short-term care plans are available is helpful.
What are Medicare short-term care plans?
Short-term care plans (STC) cover temporary health coverage needs. They’re appropriate for clients who need coverage for a few months or just a couple of years. These plans are perfect for seniors who aren’t quite eligible for Medicare, but don’t want to or can’t access a plan through the ACA or an employer.
Who are Medicare short-term care plans best for?
STCs are ideal for seniors ages 63-64 who may be retiring early or have otherwise lost their existing coverage. This client may have been insured under a group plan for years and now needs interim coverage until they turn 65. Or they may have an older spouse who’s already transitioned to Medicare, while they’re still in need of a short-term plan until they age-in as well.
Some seniors who retire early find that COBRA and ACA plans are too expensive. With an ACA plan, premiums increase as you age. Even with recent legislation to decrease these costs, seniors can still face premiums up to three times as high as younger people. So, while these short-term care plans won’t necessarily offer coverage comparable to a traditional plan, they’re almost always a more affordable option.
What do Medicare short-term care plans cover?
Medicare short-term care plans are subject to different requirements than Medicare or traditional plans under the ACA, and are allowed to deny coverage to people with pre-existing conditions. Because of this, they’re not a good fit for those with a chronic illness or complex medical needs. You can still access routine care with an STC plan, but they don’t provide comprehensive coverage.
Also worth noting is that these plans aren’t available in every state. Eleven states either don’t offer short-term plans or the restrictions are so great they’re unappealing to most consumers. And, even though federal law allows short-term plans to last up to 364 days and be renewed for a total of 3 years, states decide what limits they set. Roughly half the states have stricter limits in place for STC plans and only allow them to last a maximum of six months.
What should my clients know about these plans?
One benefit of short-term coverage is there’s no set enrollment period as there is with ACA plans and Medicare. You can apply for a plan and have access to care the very next day. This means you can start and stop coverage based on the client’s needs, and there are no penalties for missing a deadline.
An alternative type of short-term coverage that may be helpful to your clients is a Health Care Sharing Ministry like OneShare Health. As a non-profit organization, a health sharing company can be a more affordable option.
Be clear with your clients that OneShare Health is not insurance. This offering is a “medical cost-sharing ministry” that is exempt from ACA guidelines. ACA-exempt organizations don’t have to provide the coverage or care required by the ACA. They have no obligation to cover submitted expenses. They simply facilitate the voluntary sharing of eligible medical expenses among their members.
How do Medicare short-term care plans benefit you?
Medicare short-term care plans won’t make up a large part of your sales. But they’re an excellent way to reach out to potential clients before they age-in to provide them with temporary coverage. Demonstrate your excellent customer service for their short-term care, and clients are more likely to stick with you when they turn 65 and transition to a Medicare plan.
image credit: shutterstock/patpitchaya
