Availability of short-term health insurance in North Dakota

Yes. At least two insurers offer short-term health insurance in North Dakota, with initial terms of up to 180 days, or about six months. Some are renewable for a total of 360 days.

North Dakota enacted S.B.2073 in 2021. This legislation allows for longer short-term plans in the state, albeit with various requirements in terms of how the plans can be rated and the benefits that must be covered.

S.B.2073 created two different sets of rules – one for individual short-term health plans, and another for association short-term plans.

Before North Dakota enacted S.B.2073, short-term plans in the state were limited to initial terms of 185 days, and total duration, including renewal, of no more than 12 months. But under the state’s new rules:

• Individual short-term health plans can have initial terms of up to 12 months, but the total duration, including renewals, is also capped at 12 months. Insurers have to allow the plan to be renewed at the member’s discretion (without any additional medical underwriting), as long as total duration does not exceed 12 months.
• Association short-term health plans can follow federal rules, with total duration, including renewals, of up to 36 months.

But association health plans also have to follow various state requirements:

• Rates can only be based on zip code, tobacco use, age, family size, and gender. (This is similar to ACA-compliant plans, except ACA-compliant plans cannot be rated based on gender.)
• Association short-term plans must include various essential health benefits, including inpatient and outpatient care, emergency services, maternity and newborn care, mental health/substance abuse care, prescription drug coverage, lab services, rehabilitative/habilitative services, and preventive care. (In most states, it’s common for short-term plans to not cover or minimally cover several of these, including preventive care, maternity care, prescription drugs, and mental health care,³ so North Dakota’s coverage requirements for association short-term health plans are quite robust. But as noted above, there do not appear to be any association short-term policies for sale in North Dakota.)

Previous legislation (S.B. 2118), enacted in North Dakota in 2019, clarified some of the state’s existing rules, including, at that time, an initial term limit of six months. But the legislation also required short-term health insurers to allow a member to renew their coverage with no additional medical underwriting, although the total duration of the plan, including renewal, could not exceed 12 months, and insurers can impose shorter total duration limits. (Under federal rules, insurers that offer short-term plans are not required to offer renewals at all.)

S.B. 2118 also requires that all short-term plans sold in the state must be sold by a licensed insurance producer, which is in line with rules that were already in place in North Dakota.

North Dakota requires short-term plan applications to ask the consumer whether they have comprehensive major medical coverage in force, whether they understand that the short-term plan is NOT a comprehensive major medical policy, and why they are purchasing the short-term plan.

Short-term health insurance in North Dakota is available to applicants who can pass the underwriting guidelines that the insurers use. In general, this means being under 65 years old and in fairly good health.

Short-term health plans typically include blanket exclusions for pre-existing conditions, so short-term plans are not adequate for someone who needs medical care for ongoing or pre-existing conditions.³ You will likely be better served by a policy that provides comprehensive benefits.

If you need health insurance coverage in North Dakota outside of the annual open enrollment period for ACA-compliant coverage (November 1 – December 15), 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 (Obamacare) major medical plan.

There are various qualifying life events that will trigger a special enrollment period and allow you to buy a plan through the health insurance exchange in North Dakota. These plans 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 (with a premium subsidy if you meet eligibility criteria).

The North Dakota Insurance Department published a document in 2017 to warn consumers about the drawbacks of short-term coverage, limited benefit plans, and discount medical plans. In terms of when a consumer should purchase short-term coverage, the North Dakota Insurance Department said “almost never.”

Excluding coverage for pre-existing conditions can make short-term policies appear more affordable than ACA-compliant policies. However, that upfront affordability can quickly be wiped out by out-of-pocket expenses (like deductibles) or any costs related to an uncovered condition (on short-term policies, this will generally include anything that was pre-existing when the policy was purchased). That said, there may be situations in which it might make sense to use a short-term plan, such as:

• If you missed open enrollment for ACA-compliant coverage and do not have a qualifying event that would trigger a special enrollment period.
• If you are newly employed and have a waiting period until you can be covered by your new employer’s health insurance plan; short-term insurance may provide a much more affordable (but less comprehensive) stopgap than COBRA or an ACA-compliant plan.
• If you’ve already enrolled in an ACA-compliant individual plan but are waiting for it to take effect.
• If you will soon be eligible for Medicare and don’t have other coverage or a qualifying life event that would allow you to enroll in an ACA-compliant plan.
• If you’re not eligible for Medicaid or a premium subsidy in the exchange, an ACA-compliant plan might be unaffordable. This includes undocumented immigrants, as they are not eligible for Medicaid or coverage obtained through the exchange.