Insurance for New York college graduate

KM | July 21, 2008

Q: I am looking for insurance for my daughter, a recent college grad who has yet to find a job or enroll in graduate school. What does it mean when it says that Core Health Insurance plan provides LIMITED INDEMNITY COVERAGE? She currently has no health insurance (and we live in NY). For the Silver Plan is the $50 per visit what you have negotiated with the providers to charge; or is that what your plan pays and the patient is expected to pay the difference between the doctor's fees and the $50?

A: College graduates throughout most of the United States use a short term major medical insurance plan to cover the gap in coverage between the health insurance coverage they had as a student and the coverage they eventually hope to find under an employer's health plan or a graduate student health plan. Short term major medical insurance is appealing for this situation because it is inexpensive, fast, immediate issue, high quality coverage. Unfortunately New York state's insurance laws do not authorize this type of insurance. Local and federal initiatives are underway to correct this discriminatory practice but in the meanwhile New Yorkers are faced with less attractive choices.

The remaining options are:

     1) enroll in a regular major medical insurance - these are expensive, have a slow application process, and are not immediately available online.

     2) use limited benefit indemnity coverage - fast, inexpensive but limits coverage to named items and does not cover as many types of medical expenses as major medical insurance.

Given these two choices, most New York college graduates prefer the limited benefit type coverage. Core Health Insurance is the highest quality brand name insurance of this type.

The coverage listed in Core Health Insurance is the amount that the insurance pays for each named item. For example, it lists amounts paid for doctors visits, lab test, hospital charges, etc. Note that it does not list benefits for uncovered items like outpatient mental counseling that might have been included in a major medical policy. Limited benefit insurance does not provide a Certificate of Creditable Coverage and therefore is inappropriate as the sole coverage for a person with significant ongoing medical problems. See the Review of Core Health Insurance for more information.

The amount that health insurance pays is likely to be less than the full amount charged by a doctor or hospital, so it is advisable to ask if the provider will "take assignment" of the claim and accept the amount as full payment. If the provider has a "balance billing" policy then payment arrangements must be made to cover the remaining portion of the bills. We suggest combining Core Health Insurance with Value Hospital Insurance (also a limited benefit indemnity insurance) to increase overall coverage and reduce your financial risk. These insurance plans, unlike major medical policies, can be stacked to increase overall coverage. Benefits from one of these limited benefit indemnity policies are paid in the amount listed regardless of benefits paid by all other insurance policies. For this reason, it is advisable to keep the limited benefit insurance in force even after new group insurance is in place. This insurance can help cover high deductibles and co-payments of other health plans.

Remember also that if your student visits another state other than New York, a wider range of attractive insurance choices are available. Once a policy is issued while staying at a temporary address, the coverage remains in force throughout all states in the U.S., including New York. See the state availability listings chart for the most popular low cost health insurance plans in other states. A growing number of New Yorkers find that a residence out-of-state, even a vacation or temporary address, provides an answer to the health insurance dilemma created by their state's restrictive insurance laws.

Get your free quotes

Are you currently insured?

We work with trusted
companies like: