Short Term Health Insurance

What is Short Term Health Insurance?

Short term health insurance plans cover you temporarily. You can enroll in short term health insurance anytime during the year.

Short term health insurance is ideal if you:

  • Missed open enrollment for a traditional plan
  • Left or lost your job
  • Turned 26 and lost coverage through your parents

For example, you lost coverage through an employer but waited too long to enroll during the special enrollment period. In this case, short term health insurance can cover you until you can sign up at the end of the year.

Short term health insurance can cover you for up to 12 months. However, some insurers can renew your coverage for up to 36 months, depending on which state you live.

Coverage ends when the term you selected ends. In some cases, you can apply for an additional period if necessary.

Short term health insurance is less expensive compared to major medical plans. However, they are not as comprehensive as traditional policies. They have significant gaps in coverage. Short term health insurance is helpful in case of catastrophe.

Typically, if you apply for short term health insurance, your policy can go into effect within a few days. With traditional health insurance, it may take a few months.

Since it is not a comprehensive major medical plan, there are no penalties if you cancel the insurance before the term ends.

Short term health insurance is not right for everyone. If you want a comprehensive major medical plan, you can enroll through the health insurance market if your employer does not provide access.

Short Term Health Insurance Coverage and Limits

Since short term health insurance covers catastrophic health emergencies, it offers limited coverage.

Typically covers:

  • Unexpected injury
  • Hospitalization
  • Emergency care
  • Preventative care
  • Urgent care
  • Doctor's appointments

Generally does not cover:

  • Treatment or doctor's appointments for pre-existing medical conditions
  • Prescription medication
  • Maternity care
  • Mental health care

It is important to read the Exclusions and Limitations section of any plan.

Usually, the limit resets with each term, but some insurers place a lifetime maximum on the insured.

Short Term Health Insurance is not ACA-compliant

ACA-compliant plans must provide essential benefits, but short term plans are exempt from this requirement.

Also, short term health insurance plans do not qualify for the health insurance subsidy, but ACA-compliant policies do. Keep in mind, the government subsidy is only available to people within specific income limits.

ACA plans have no benefit limit, so they can pay for your care indefinitely. However, short term health insurance plans have dollar limits. Once your health care expenses reach a specific level, they stop paying for your treatment.

Short Term Health Insurance is not Guaranteed-Issue

ACA-compliant plans are required to accept anyone, regardless of their medical history (aka guaranteed issue). However, short term plans may decline your application based on your health conditions.

Cost of Short Term Health Insurance

Short term health insurance typically includes out-of-pocket costs:

  • Premium – monthly fee for coverage
  • Copay – amount you pay the provider at the time of service or treatment
  • Deductible – amount you pay out-of-pocket until your insurer begins paying
  • Coinsurance – Cost-sharing percentage, you pay some, and the insurer pays the rest

If your short term health insurance does not cover treatments or services, you will pay for them out-of-pocket.

Check your specific plan for details about coverage, copayments, deductibles, and coinsurance amounts.

Where Can I Get the Lowest Price on Health Insurance?

AARDY is the nation's fastest health insurance market. We can help you find the best health insurance plan. Our service compares Affordable Care Act and Short Term plans so you can find the best fit.


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