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Short-Term Major Medical Insurance vs. Short-Term Care Insurance

What to expect from these two different types of short-term insurance

Short-term major medical insurance is often mistakenly confused with Short-Term Care insurance. But as you look closely at these two types of health insurance, you can see they are quite different — from who qualifies for them or who might need them to who provides them and what they cover.

What is short-term major medical insurance?

Short-term major medical insurance, sometimes called short-term insurance, is designed to provide temporary coverage for medical expenses when comprehensive health insurance is otherwise unavailable. This coverage, which varies by state, might be beneficial if you have lost your job, change employers, retire before Medicare begins, or if you miss the Affordable Care Act’s (ACA) open enrollment period.
Short-term major medical insurance plans typically offer lower premiums than regular health insurance and a wide range of options, including deductible amounts and benefit maximums. Other features include immediate enrollment and flexibility in choosing insurance providers, length of enrollment period, and covered medical services. Short-term major medical insurance can be offered with initial terms of up to 364 days plus options to renew for a total of 36 months of insurance coverage under a single plan. That’s unlike regular health insurance, which has an annual renewal period.
Also unlike regular health insurance, short-term major medical insurance doesn’t follow federal mandates of the ACA, which requires all regular medical insurance plans to cover the 10 Essential Health Benefits and no less than 60% of medical expenses. Instead, regulations and availability of short-term major medical insurance plans vary in each state, though all short-term major medical insurance plans exclude coverage for pre-existing conditions. Other services not covered by short-term major medical insurance plans typically include substance abuse treatment, mental health services, and outpatient prescription drugs.

What is Short-Term Care insurance?

Short-Term Care insurance is a relatively new type of insurance that provides up to 360 days of coverage for the following types of care:

  • Home healthcare
  • Adult daycare
  • Assisted living
  • Nursing home care
  • Hospice care

With a variety of options for Short-Term Care insurance, you have the flexibility to choose your coverage period and change where you receive your care.
Short-Term Care insurance may ease your out-of-pocket costs, help you cover medical expenses that may not be covered by Medicare or other supplemental insurance plans, and help protect your assets in retirement. For example, Short-Term Care insurance can provide coverage while waiting for a Long-Term Care insurance plan to kick in, because it has lower elimination periods, from 0 to 30 days.
Even though your current health status is subject to underwriting, anyone who needs Short-Term Care insurance can become eligible to receive benefits with a statement from a board-certified physician acknowledging one of the following:

  • You no longer have functional capacity in two or more of the following activities of daily living: bathing, continence, dressing, eating, toileting, and transferring.
  • You suffer from a cognitive impairment, including confusion, poor motor coordination, loss of short-term or long-term memory, identity confusion, or impaired judgment.

If you’d like to learn more about AARP® Short-Term Care Insurance from Medico®, click here to get a quote or receive additional information.

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Medico Insurance Company Disclosures

Exclusions and limitations (may vary by state)
No benefits will be paid for any expense not identified and included as a covered loss under the policy. You will be fully responsible for payment of any expense that is not a covered loss. We will not pay benefits for:

  1. Any loss that occurs while this policy is not in force.
  2. Services or supplies not covered under this policy or not included in your plan of care.
  3. Treatment of complications of a non-covered loss.
  4. Any treatment for loss that: 
    1. Is not medically necessary.
    2. Is not prescribed by a physician as necessary to treat a sickness or injury.
    3. Is determined to be experimental or investigational.
    4. Is received without charge or legal obligation to pay.
    5. Would not routinely be paid in the absence of insurance.
    6. Is received from any family member.
  5. Any suicide attempt, while sane or insane, or any intentionally self-inflicted injury.
  6. Alcoholism, drug addiction, or their complications, unless addiction resulted from narcotics prescribed by a physician.
  7. Injuries received or caused directly or indirectly while under the influence of a controlled substance, unless prescribed by a physician, or by intoxication as defined by the laws and jurisdiction of the geographic area in which the loss or cause of loss was incurred.
  8. Loss to which a contributing cause was your commission of or attempt to commit a felony or being engaged in an illegal occupation.
  9. Loss that occurs outside the territorial limits of the United States.
  10. Any loss resulting from war, declared or undeclared, or actively serving in the armed forces or their auxiliary units, including any country’s National Guard or Army Reserve or their equivalent.
  11. Any loss resulting from any device for aerial navigation, except as a fare-paying passenger.

STCI-015 Rev. 02/21