4 ways to evaluate alternative health coverage

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Most of the uninsured have to wait five months for the next chance to seek coverage on the health care overhaul's public exchanges. But that doesn't mean they need to spend the summer worrying about their lack of protection from large medical bills.

The state-based exchanges, a cornerstone in the overhaul's push to expand insurance coverage, still permit customers to buy coverage under certain circumstances. The uninsured also can buy a temporary plan to cover them for a few months.

Here are some questions to consider if you missed the enrollment window that ended this spring and still want to buy a plan.

1. CAN I STILL USE A HEALTHCARE EXCHANGE?

A major life change -- such as a move to another state, marriage, divorce, and the birth or adoption of a child -- would allow you to use the exchanges to find coverage. Anyone who becomes a U.S. citizen or leaves prison also is entitled to enroll between open enrollment periods.

Aside from exceptions like these, those who want to use the exchanges will have to wait until Nov. 15, when enrollment begins for coverage that starts in 2015.

Insurance purchased on the exchanges comes with a key advantage: Applicants may be eligible for income-based tax credits that help pay the cost of their coverage.

1. WHAT OTHER OPTIONS DO I HAVE?

Employer-sponsored coverage is the most common form of health insurance in the United States. Landing a job that offers insurance or gaining coverage through a spouse's employer are two key paths to gaining major medical coverage.

A short-term plan can be an option for less-extensive coverage. This coverage generally runs for less than a year and can be as short as 30 days. Think of it as a safety net.

It's designed to protect you from a potentially devastating medical bill, but it's generally not as thorough as coverage you would find on the exchange or through an employer.

"It gives (the enrollee) some level of protection until they can get to their next open enrollment period," said Bob Hurley, a senior vice president with the private health insurance exchange operator eHealth Inc.

These plans tend to require customers to pay more costs out of pocket than a major medical plan found on an exchange, said Gary Claxton, a vice president with the Kaiser Family Foundation, which studies health care issues.

Limited benefits plans are another, albeit skimpier option. For instance, that coverage may only pay a few hundred dollars for an overnight stay in a hospital that costs well north of $1,000.

Some insurance shoppers also may qualify for the state-federal Medicaid program, if their income level is low enough. Medicaid eligibility varies by state.

1. HOW SHOULD I EVALUATE THESE OPTIONS?

Read the plan details carefully.

If you find a good deal on an insurance policy, you need to understand why it's a good deal. Lower premiums can mean less coverage, so analyze what you would pay for a doctor visit or hospital stay. Understand your other out-of-pocket responsibilities such as the deductible, which is the amount a customer pays before most coverage starts.

Think hard, as well, about how long you will need the policy. Some insurers require customers to wait for a certain period before they can buy another short-term policy, said Bonnie Milani, an independent insurance broker in Los Angeles. That could lead to a coverage gap if you want to stick with that insurer and not buy a plan from another carrier.

1. WHAT ARE THE DRAWBACKS OF THESE ALTERNATIVES?

Short-term or limited benefits plans generally offer less coverage than policies available on an exchange.

A short-term plan may cover your doctor's visit but not vision care, a trip to the dentist or preventive care like a flu shot. They also typically don't include maternity coverage and can exclude pre-existing conditions like diabetes or high blood pressure. Plans sold on the exchanges are no longer allowed to limit coverage on that basis.

These plans don't meet minimum coverage requirements spelled out by the law. That means people who buy short-term or limited benefits plans may have to pay a fine imposed by the overhaul on those who remain uninsured.

The fine can be as much as several hundred dollars depending on the person's income level. Those who are uninsured for part of the year will pay a penalty based on how many months they are uninsured. Anyone uninsured for less than three months in 2014 won't face a penalty.

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