Short-term health plans in Minnesota
- Short-term health insurance in Minnesota is limited by statute: The plans are nonrenewable and cannot last more than 185 days.
- Additional short-term coverage can be purchased, but you can’t have more than 12 months of short-term insurance in an 18-month period.
- 2018 legislation to extend short-term plans in Minnesota was not enacted.
- UnitedHealthcare/Golden Rule offers short-term health insurance in Minnesota, but the number of available short-term insurers has dwindled in recent years.
Short-term plans duration in Minnesota
Short-term health insurance plans in Minnesota cannot last more than 185 days (six months) unless the insured is in the hospital on the day that the plan would have terminated and the insurer extends the coverage until the end of the hospital stay. This is clearly defined in Minnesota statute (62A.65, Subdivision 7).
Short-term plans are nonrenewable in Minnesota, but a person can buy additional short-term insurance as long as their total amount of time with short-term coverage doesn’t exceed 365 days out of any 555-day period (12 months out of 18 months), plus any days that a plan is extended to cover an insured who is in the hospital on the day the plan would have ended.
This includes plans from multiple insurance carriers, so a person cannot continue to purchase back-to-back short-term plans from different health insurers in order to maintain continuous coverage; a Minnesota resident can only have short-term health coverage for a total of 12 months out of any 18 month period.
HF138, which was considered by Minnesota lawmakers in 2018, would have redefined a short-term plan as being less than a year in duration and eliminated the 365 out of 555 days cap. The bill passed the House, but did not advance to a vote on the Senate floor.
The federal rules that took effect in late 2018 (which allow for initial terms of up to 364 days and total duration, including renewals, of 36 months) do not apply in Minnesota. Instead, short-term plans continue to be governed by the state’s existing statute. The Minnesota Commerce Department published guidance for consumers in 2018 regarding short-term plans, clarifying that the state’s rules would remain in effect and take precedence over the new federal rules.
Other short-term healthcare insurance rules in Minnesota
Minnesota also has a list of comprehensive guidelines that apply to short-term policies. Short-term health plans in Minnesota cannot cover pre-existing conditions, but must also be available immediately without underwriting, and cannot use gender rating to determine premium costs.
Which insurers offer short-term plans in Minnesota?
In late 2018, there were at least six health insurance companies offering short-term health plans in Minnesota. But as of 2020, we could only find plans available from United Healthcare/Golden Rule.
We discussed this with the Minnesota Commerce Department, and they said that although the state’s rules are the same as they were in 2018, several insurers have decided to stop offering short-term health plans because they weren’t selling as well as ACA-compliant plans.
Who can buy short-term health insurance in Minnesota?
Short-term health insurance in Minnesota can be purchased by residents who can meet the underwriting guidelines set out by insurers. This generally means being under 65 years old (some insurers put the age at 64) and in fairly good health.
Short-term health plans in Minnesota include blanket exclusions for pre-existing conditions, so these types of plans are not adequate for someone who needs medical care for ongoing or pre-existing conditions. And short-term plans are not required to cover essential health benefits, so these plans will often exclude things like maternity care, prescription drugs, and mental health care.
If you’re in Minnesota and need health insurance, your first step should be to see whether you’re eligible for a special enrollment period that would allow you to enroll in an ACA-compliant individual major medical plan through MNsure (the state-run health insurance exchange in Minnesota). A variety of qualifying life events can trigger a special enrollment period.
The plans available through MNsure are purchased on a month-to-month basis, so you can enroll in a plan even if you only need coverage for a few months before another policy takes effect. And if your household income makes you eligible for a premium subsidy, your monthly premium costs will be much more affordable than they would otherwise be, and might even be lower than the cost of a short-term health plan.
When should I consider short-term health insurance in Minnesota?
You may need to consider short-term health insurance in Minnesota if:
- You missed open enrollment for ACA-compliant coverage and do not have a qualifying event that would trigger a special enrollment period.
- Your existing coverage is ending mid-month. If you’ve enrolled in a new plan through MNsure, it typically cannot take effect sooner than the first of the month after your old plan ends; if the old plan is ending mid-month, that would mean a gap in coverage before the new plan takes effect. A short-term plan (which takes effect the day after you enroll) can bridge this gap. But depending on the circumstances, COBRA or state continuation might be a solution too, allowing you the option to sign up for coverage if you end up needing care during the rest of the month after your old plan ends.
- You’re enrolling in Medicare soon and need coverage to bridge the gap before Medicare takes effect but you don’t have a qualifying event that would allow you to enroll in MNsure (you’ll be able to switch to a MNsure plan during open enrollment in the fall, if your Medicare coverage won’t take effect until sometime in the coming year).
- You’re newly employed and the health benefits offered by your employer have a waiting period. A short-term plan can provide coverage for unexpected medical events during the time before your eligibility for your employer’s plan begins.
- You’re not eligible for Medicaid or a premium subsidy in the exchange. Depending on the circumstances, the monthly premium costs for an ACA-compliant plan might be unaffordable.
Times you may be ineligible for premium subsidies include:
- If you earn more than 400% of the poverty level. (For 2021 coverage, that’s $51,040 for a single person. If your ACA-specific modified adjusted gross income is just a little above the subsidy-eligible threshold, there are steps you can take to reduce it).
- People who have fallen into the ACA’s family glitch and do not have an affordable coverage option through the employer-sponsored plan or the marketplace.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.