Short-Term Health Insurance: Is It Right for You?
Between jobs, waiting for new coverage to begin, or dealing with another temporary gap? Short-term health insurance may provide limited medical coverage for a temporary period.
It can sometimes have a lower monthly premium than comprehensive health insurance, but it also comes with important limitations. It is not the same as ACA-compliant major medical coverage.
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What Is Short-Term Health Insurance?
Short-term health insurance is temporary medical coverage generally designed to help bridge a gap between longer-term health plans.
Depending on the policy, it may provide benefits for certain unexpected illnesses, injuries, hospital stays, emergency care, or other covered medical services.
It may be worth considering when:
You're Between Jobs
Your previous employer coverage ended and your next employer health plan has not started yet.
You're Waiting for Other Coverage
You have another form of coverage beginning soon and only need protection for a temporary gap.
You Missed an Enrollment Window
Depending on your circumstances and state, temporary coverage may be one option to consider until other coverage becomes available.
You Want Temporary Protection
Some people primarily want protection against certain unexpected medical expenses during a short transition period.
What Short-Term Plans May Not Cover
Short-term coverage is generally exempt from many of the federal requirements that apply to ACA-compliant individual health insurance. Benefits can therefore be much more limited.
Depending on the policy, limitations or exclusions may apply to:
- Pre-existing medical conditions
- Maternity and newborn care
- Mental health treatment
- Substance-use treatment
- Prescription medications
- Preventive services
- Specialty medications
- Certain therapies or ongoing treatment
Read the Actual Benefits and Exclusions
Short-term plans are not all the same. One policy may cover a service that another excludes or limits.
Before enrolling, make sure you understand the deductible, coinsurance, benefit maximums, exclusions, provider network, prescription benefits, and pre-existing-condition rules.
Your Medical History Can Matter
This is one of the most important differences between short-term coverage and ACA-compliant major medical insurance.
Short-term policies may use medical underwriting and may exclude pre-existing conditions.
Claims May Be Reviewed Against Your Prior Medical History
Depending on the policy and circumstances, an insurance company may review medical records when evaluating a claim to determine whether an illness or condition began before the coverage became effective.
If a condition falls within the policy's definition of a pre-existing condition or another exclusion, the claim may not be covered.
An insurer may also investigate whether information provided during the application was complete and accurate, subject to the policy terms and applicable law.
This is why being approved for a short-term policy should not be confused with having the same protections that come with an ACA-compliant major medical plan.
How Long Can Short-Term Health Insurance Last?
The answer depends on current federal rules, your state, the insurance company, and the specific policy.
Short-term insurance rules have changed several times in recent years, and states can impose their own restrictions or prohibit these policies altogether.
Short-Term vs. Other Health Insurance Options
| Feature | Short-Term | Marketplace | Other Private Coverage |
|---|---|---|---|
| Pre-existing conditions | May be excluded | Covered | Depends on the plan |
| Medical underwriting | May apply | No | May apply |
| Marketplace financial assistance | No | May be available if eligible | No |
| Enrollment timing | May be available outside Open Enrollment | Open Enrollment or eligible Special Enrollment Period | Depends on the plan |
| Designed for long-term comprehensive coverage | Generally no | Yes | Depends on the plan |
| Benefits and exclusions | Can be more limited | ACA major medical protections apply | Varies significantly |
This is a general comparison. Specific benefits, exclusions, eligibility, underwriting, duration, and availability vary by plan and state.
When Another Option May Be Worth Considering
You Have a Pre-Existing Condition
ACA-compliant Marketplace major medical plans cover pre-existing conditions and cannot deny coverage or charge more based on your health.
Your Income Recently Changed
Depending on eligibility, Marketplace financial assistance may reduce the cost of comprehensive individual health insurance.
You Need Ongoing Prescriptions or Treatment
If you regularly use healthcare, take expensive medications, or see specialists, compare the actual benefits carefully before choosing temporary coverage.
You Recently Lost Employer Coverage
Losing qualifying job-based insurance may create a Marketplace Special Enrollment Period. COBRA may also be available.
You Want Longer-Term Coverage
If you don't actually have a temporary gap, it may make more sense to compare longer-term health coverage rather than relying on a short-term policy.
You Need Broad Benefits
If maternity, mental health, prescriptions, preventive care, or other comprehensive benefits matter to you, make sure the policy you're considering actually includes them.
Common Questions About Short-Term Health Insurance
Can I buy short-term health insurance outside Open Enrollment?
In states where short-term insurance is available, applications may be accepted outside the annual Marketplace Open Enrollment period.
Availability, effective dates, and eligibility depend on the insurance company and your state.
Does short-term health insurance cover pre-existing conditions?
Many short-term plans exclude pre-existing conditions or have limitations related to medical conditions that existed before coverage began.
Always review the specific policy definition and exclusions before enrolling.
What is post-claim underwriting?
The term is commonly used to describe situations where an insurer reviews medical history after a claim has been submitted to determine whether the condition or service is covered under the policy.
The exact claims-review process varies by policy and insurance company, so it's important to understand how the plan handles pre-existing conditions and prior medical history.
Is short-term health insurance cheaper?
It can have a lower monthly premium than some comprehensive health insurance options, but that does not necessarily mean it will cost less overall.
Lower premiums can come with higher deductibles, exclusions, benefit limits, or services that aren't covered.
Can I get Marketplace financial assistance for a short-term plan?
Marketplace premium tax credits are used for eligible Marketplace health plans, not short-term insurance.
Does short-term insurance cover prescriptions?
It depends on the policy. Some plans may provide limited prescription benefits, while others may exclude or significantly restrict prescription coverage.
If you take regular medications, check them before enrolling.
Does short-term insurance cover preventive care?
It may not provide the same preventive-care benefits that ACA-compliant health plans are required to provide.
Benefits vary by policy, so review the plan details carefully.
Is short-term health insurance available in every state?
No. Some states restrict or prohibit short-term health insurance, and availability can change.
See the states we serve or contact us and we'll check current availability where you live.
How long can I keep a short-term plan?
Maximum duration depends on current federal requirements, state law, the carrier, and the policy.
Because these rules have changed in recent years, we'll verify the current limit for your state rather than relying on older general rules.
Is short-term insurance the same as major medical insurance?
No. Short-term health insurance is temporary coverage and is generally exempt from many requirements that apply to ACA-compliant individual major medical insurance.
How do I know if short-term insurance is right for me?
Look at how long you need coverage, your current health, recent medical treatment, prescriptions, upcoming care, your budget, and what other coverage is available.
We can help you compare those factors before you make a decision.
Understand the Tradeoffs Before You Buy
Short-term health insurance can be useful for certain temporary gaps, but the lower premium can come with important limitations. We'll help you compare it with the other coverage available to you.
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