HIPAA Credible Coverage

[Guest Stephen47]

Does "Short Term" health insurance coverage qualify as "credible coverage" under the HIPAA portability definition? I have a client who has a 90 day waiting period in his new job. Rather than electing Cobra coverage, he wishes to secure 90 days of "Short Term" coverage to save money. Does this threaten his portability of credible coverage?

[Guest SLCraig]

Short-term healthcare policies are not typically considered creditable coverage. HOWEVER, in the situation you described, he would be all set because he is in his waiting period. HIPAA's continuity applies through to the date of the start of the waiting period. Even if the waiting period were six months, he would be okay, because he had continuous coverage until his waiting period began.

One thing to consider about short-term medical policies is that they will not cover pre-existing conditions. Some policies will not be issued for certain medical reasons.

Hope this helps.

[Guest Tom J]

I disagree. Short term policies are themselves exempt from most of the HIPAA requirements. Thus, SL is right in saying they won't cover pre-x, or recongnize creditable coverage. However, most of them will serve well as a placeholder against a 63 day gap. In the interim regs, see 45CFR146.143.

I say "most" short term policies, because they would not constitute creditable coverage if they consisted solely of "excepted benefits" such as Hospital Indemnity or Specified Disease coverage. But if they are structured like a major med or major hosp, they'll do the trick.