Unlike traditional health insurance plans, short-term insurance policies provide medical coverage for a limited period of time, usually no longer than 12 months. Temporary health insurance is ideal for people who are only temporarily uninsured, such as those who are in-between jobs, waiting on employer or government-sponsored health benefits, or have missed the ObamaCare open enrollment period.
A short-term insurance plan may be beneficial to you based on your insurance needs and employment situation. The primary differences between short-term and regular insurance policies are outlined below to help you decide if a short-term plan is right for you.
Short-term insurance is not required to observe the ACA requirements.
Short-term plans do not cover all of the ten essential health benefits that ACA health plans are required to cover. Most short-term plans are designed to protect against sudden illnesses and injuries and provide only emergency services coverage.
Short-term insurance is flexible.
The coverage duration of short-term insurance plans ranges from 30 days to 12 months, so your length of coverage is up to you. Short-term policies are also often approved quickly, and can go into effect as soon as the day after applying.
Short-term insurance is less expensive.
Short-term policies can use medical underwriting to reject less healthy people or those with certain health conditions. As a result, this makes the cost of short-term plans much lower than regular insurance plans.
Short-term insurance is not renewable.
Once your short-term insurance coverage period ends, you cannot renew your existing policy. However, you may be able to enroll in a new short-term health insurance policy. You can usually enroll in up to two policies each year.
Short-term insurance does not provide pre-existing condition coverage.
Unlike traditional insurance, which covers pre-existing conditions, short-term insurance plans do not provide pre-existing condition coverage. Short-term policies only protect against unforeseen incidents, covering basic medical needs and emergencies. If you have a pre-existing medical condition, a short-term insurance plan may not provide you with the coverage you need.
Short-Term Health Insurance Vs. Regular Insurance (Tabular Comparison)
|Short-Term Health Insurance||Regular Health Insurance|
|Length of Coverage||30 days to 12 months||Per Policy Period|
|Meets ACA Requirements||No. Short-term insurance plans are not required to comply with ACA coverage requirements.||Yes. Under the ACA, all insurance plans must provide coverage for the 10 Essential Health Benefits and cover at least 60% of medical expenses.|
|Cost||Cost of short-term insurance plans varies depending on deductible and coinsurance, but is much less than regular plans.||Cost of regular insurance varies but is much higher than short-term plans.|
|Eligibility||People with certain health conditions may not be eligible to enroll.||Anyone is eligible to enroll for Qualified Health Plans under the ACA.|
|Renewable||May not be renewable.||Yes|
|Preventative Care||Usually not.||Yes|
|Pre-Existing Condition Coverage||Usually not.||Yes|
|Pregnancy and Maternity Care||Usually not.||Yes|
|Mental Health Care||Usually not.||Yes|
Short-term insurance can be beneficial for some individuals, but may not meet all health insurance needs. Before purchasing a short-term health insurance plan, be sure to read your policy details thoroughly so that you understand all benefits and exclusions of your short-term policy. Even if you are waiting for a brief period until your next insurance plan begins, having some medical protection is better than having none at all during that gap.