Filling a Health-Coverage Gap

Individual Plans continued...

Coverage periods are typically brief. Golden Rule Insurance, for instance, offers a short-term major medical plan in which the consumer chooses coverage for one to six months. Fortis Health offers short-term medical plans for 30 to 185 days, says Kathy Quirk, a spokeswoman.

Not all companies do business in all states. Companies usually offer a choice of deductibles ($250, $500 or $1,000, for example) and a choice of major medical coverage (with 80 percent of covered expenses paid or 50 percent of covered expenses paid). Here's one way a temporary plan could work: A 22-year-old woman in Wisconsin who just graduated from college and wants a 60-day, 80/20 major medical plan with a $500 deductible would pay a total, lump-sum premium of $86.40.

Applications for the policies are fairly brief. Generally, no physical exam is required. But if you have pre-existing conditions -- such as heart disease or other serious problems -- you may be denied coverage.

Short-term plans are intended to cover unexpected illness and accidents, not preventive care. If you anticipate still needing coverage after the temporary plan expires, you may be able to apply for a second policy.

To minimize costs, choose a plan with a higher deductible and 50/50 coverage, and pay the premium in a single payment rather than in installments.