Wednesday, December 8, 2010

Growing need for short term medical insurance in Washington state

Washington state residents faced a higher than usual risk of employement layoffs over this past year and this trend will continue into 2011, particularly among its younger workers. Exel already announced 146 permanent layoffs in Auburn for next month (January 2011) and International Paper will lay off another 78 in Bellevue.
Layoffs at commercial employers follow layoffs and other work reductions for state government employees. In April 2010 the state Legislature passed and Gov. Chris Gregoire signed into law Engrossed Substitute Senate Bill 6503 that was designed to reduce state government spending for employees, the law requires that state agencies close on the 10 days specified in the bill or submit an alternate compensation reduction plan for approval by the Office of Financial Management.
Last week Governor Chris Gregoire proposed deep budget cuts, including the elimination of the state's health insurance program for the poor in response to the state’s budget crisis. Marty Brown, director of the Office of Financial Management, says the state needs to cut $901 million in spending. Legislators likely will face a special session to deal with the state’s budget gap prior to the regular session in January.
These are typically candidates for low cost short term medical insurance during their position of transition as a more cost-effective alternative to COBRA. While most U.S. residents have a choice of several short term medical insurance plans, Washington residents have only one. Markel Insurance Company apparently is apparently the only commercial insurance provider who has applied and received consent from the state insurance department to offer these policies. Freedom Benefits Insurance Exchange recently reviewed this coverage. We have no concerns about this single payor system, since Markel has a longstanding reputation as a stable and reliable provider of specialty insurance.
Short term medical insurance can be issued immediately with an online application and coverage can extend to as long as 12 months.  While short term medical insurance is typically hassle-free, it does not cover the cost of treating pre-existing medical conditions and so is not appropriate for a person who has large ongoing medical costs. COBRA and other continuation plans, although more expensive, are a better option for high medical risk individuals.

No comments: