Are you in a bind, needing quick and affordable health insurance? Look no further than short – term health insurance. A recent study by the Kaiser Family Foundation shows that short – term policies can cost 20% less than traditional long – term plans. According to the National Association of Insurance Commissioners, these plans also offer rapid enrollment. However, there are significant differences between premium short – term health insurance and counterfeit models. We’ve prepared this buying guide to help you navigate the pros, cons, and limitations. With a Best Price Guarantee and Free Installation Included, find the perfect local short – term health insurance now.

Pros and Cons

Pros

Quick enrollment and immediate coverage

According to industry data, short – term health insurance often allows for rapid enrollment. In many cases, individuals can get coverage within a matter of days, unlike some traditional long – term health insurance plans that may take weeks to finalize. For example, a freelance worker who suddenly loses their employer – sponsored insurance can quickly sign up for a short – term plan to ensure they have immediate medical protection. Pro Tip: If you’re in a hurry to get coverage, gather all necessary documents like your ID and medical history in advance to speed up the enrollment process.

Affordable premiums

Price is a significant enticement for short – term health insurance. A study by the Kaiser Family Foundation found that on two large online private insurance marketplaces, the cheapest short – term policies were commonly priced at 20% less than traditional plans. For instance, a young and healthy individual who is between jobs might find a short – term policy that costs only a few hundred dollars a month, making it a more budget – friendly option. As recommended by leading insurance comparison tools, always compare premiums from multiple providers to find the best deal. Pro Tip: Look for discounts or special offers that some insurers may provide, such as multi – month payment discounts.

Temporary coverage

Short – term health insurance plans offer quick and temporary coverage that can last anywhere from 1 to 12 months, which is ideal for those experiencing a gap in health insurance. For example, a recent college graduate waiting for their new job’s insurance to kick in can opt for a short – term plan for the few months in between. Try our coverage duration calculator to determine the ideal length of your short – term policy. Pro Tip: Make sure to calculate the exact time you’ll need coverage to avoid overpaying.

Cons

Short – term health insurance comes with several limitations. There are often strict coverage limits. For example, there may be limits on covered doctor visits, commonly no more than three visits per insurance period, and dollar limits on covered benefits, like only $1,000 per day in the hospital. Data from the National Association of Insurance Commissioners shows that the top three companies selling short – term health plans (based on premiums earned) had varying loss ratios, paying 43%, 34%, and 52% of the premiums they collected from short – term plan enrollees for medical claims. This indicates that not all of the premiums are being used for claim payments. A real – life case is Winard, who chose a short – term policy. When he needed a colonoscopy, he faced difficulties with his insurance company. Pro Tip: Carefully read the fine print of the policy to understand all the limitations and exclusions before signing up.
Key Takeaways:

• Short – term health insurance offers quick enrollment, affordable premiums, and temporary coverage.
• However, it has significant limitations such as coverage limits and variable loss ratios among insurers.
• Always do thorough research and read the policy details before choosing a short – term health insurance plan.

When is Short – Term Health Insurance Appropriate?

Did you know that according to a study, there are millions of Americans who experience gaps in their health insurance coverage each year? Short – term health insurance can be a valuable option in certain situations.

Transitional periods

Between jobs

Changing jobs is a common life event that often leads to a gap in health insurance coverage. For instance, if you leave your current job on the 15th of the month and your new job’s health insurance benefits don’t start until the 1st of the next month, you could face a two – week uninsured period. Short – term health insurance can bridge this gap, ensuring you’re still covered in case of an unexpected medical emergency. Pro Tip: When looking for short – term coverage between jobs, compare quotes from multiple insurers to find the best rate.

Waiting for other health insurance to begin

Sometimes, even after starting a new job, there’s a waiting period before your employer – sponsored health insurance kicks in. This could be due to probationary periods or administrative processes. In these cases, short – term insurance can act as a stopgap. A data – backed claim from a health insurance industry report shows that on average, waiting periods for employer – sponsored insurance can range from 30 to 90 days. As recommended by eHealthInsurance, a well – known industry tool, short – term plans can be explored during this time.

Outside enrollment periods

The open enrollment periods for major health insurance plans are limited. If you miss these periods and suddenly need coverage, short – term health insurance can be a viable solution. For example, if you get married outside of the open enrollment period and your spouse’s insurance won’t cover you immediately, a short – term plan can provide coverage until the next open enrollment.

On a tight budget

Price is the primary enticement of short – term health insurance plans. According to a study by the Kaiser Family Foundation, the cheapest short – term policies on two large online private insurance marketplaces were commonly priced at 20% less than traditional long – term plans. If you’re on a tight budget and need basic coverage for a short period, these plans can be suitable. However, it’s important to note the limitations. For example, there may be limits on covered doctor visits (e.g., no more than three visits per insurance period) and dollar limits on covered benefits (such as only $1,000 per day in the hospital). Pro Tip: Before purchasing a short – term plan due to budget constraints, make a list of your essential medical needs and ensure the plan covers them.

Unsuitable for chronic conditions

Short – term health insurance is not appropriate for those with chronic conditions. These plans usually do not cover pre – existing conditions or have very limited coverage for them. For example, if you have diabetes and rely on regular medications and doctor visits, a short – term plan may not provide the comprehensive coverage you need. The National Association of Insurance Commissioners has reported that short – term plans often have high out – of – pocket costs for individuals with chronic illnesses.

Real – life examples

Let’s look at the case of Winard. He was in the process of starting his own business. Instead of getting a long – term policy, he chose a short – term policy, good for six months. When the first policy expired, he signed up for another short – term policy with a different insurer that cost about $500 a month. When he needed a colonoscopy, he called his insurance company. While the short – term policy provided some coverage, he still faced some out – of – pocket expenses due to the plan’s limitations.
Key Takeaways:

• Short – term health insurance is ideal during transitional periods like between jobs, waiting for other insurance to start, or outside enrollment periods.
• It can be a budget – friendly option but comes with coverage limitations.
• It’s not suitable for those with chronic conditions.
• Real – life examples show that while it can provide some coverage, out – of – pocket costs may still occur.
  Try our short – term health insurance comparison tool to find the best plan for your situation.

Limitations of Short – Term Plans

Statistics show that many consumers are attracted to short – term health insurance due to its lower price, but a study by the Kaiser Family Foundation reveals that there are numerous limitations to these plans.

Pre – existing conditions exclusion

One of the most significant limitations of short – term health insurance is the exclusion of pre – existing conditions. If an individual has a pre – existing illness or condition, such as diabetes, heart disease, or asthma, these conditions are typically not covered by short – term plans. For example, if someone has been diagnosed with high blood pressure before purchasing a short – term policy, any medical expenses related to managing that high blood pressure will not be paid for by the insurance.
Pro Tip: Before considering a short – term plan, thoroughly review the policy’s definition of pre – existing conditions. Some plans may have a waiting period for certain conditions, so it’s important to know the rules in advance.

Limited medical services coverage

Preventive care

Short – term plans often do not cover preventive care services adequately. Preventive care, such as annual physicals, vaccinations, and routine screenings, is crucial for maintaining good health and detecting potential issues early. Many short – term policies may not pay for these services at all, or they may only cover a limited number of them. For instance, a short – term policy may not cover a flu vaccine, leaving the insured to pay out – of – pocket.

Maternity services

Maternity services are also generally not covered by short – term health insurance. This means that if a woman becomes pregnant while on a short – term plan, the costs associated with prenatal care, childbirth, and postnatal care will not be covered. As recommended by industry experts, women who are planning to become pregnant or are already pregnant should look for comprehensive health insurance options rather than short – term plans.

Mental health services

Mental health is an important aspect of overall well – being, but short – term plans may offer limited or no coverage for mental health services. Therapy sessions, counseling, and treatment for mental health disorders like depression and anxiety may not be included in the policy. For example, if an individual is going through a difficult time and needs to see a therapist, they may have to pay for these services themselves if they are on a short – term plan.
Pro Tip: If you have a history of mental health issues or think you may need mental health services, consider a comprehensive health insurance plan that offers adequate coverage.

Visit and benefit limits

Short – term policies come with various visit and benefit limits. For example, there may be limits on covered doctor visits, such as no more than three visits per insurance period. There are also dollar limits on covered benefits, like only $1,000 per day in the hospital. Charges above these limits will have to be paid by the insured. According to data from the National Association of Insurance Commissioners, the top three companies selling short – term health plans paid relatively low percentages (43%, 34%, and 52%) of the premiums they collected from short – term plan enrollees for medical claims.

Coverage duration

The coverage duration of short – term health insurance is another limitation. A finalized federal rule announced in March 2024 imposed new nationwide duration limits on short – term limited duration insurance (STLDI) plans. Plans sold or issued on or after September 1, 2024, are limited to 4 months. This means that if an individual has a long – term need for health insurance, a short – term plan may not be sufficient. For instance, if someone loses their job and expects to be unemployed for a year, they will need to find alternative insurance after the short – term plan expires.
Key Takeaways:

• Short – term health insurance often excludes pre – existing conditions.
• Coverage for preventive care, maternity services, and mental health services is typically limited or non – existent.
• There are visit and benefit limits, which can lead to high out – of – pocket costs.
• New regulations limit the coverage duration of short – term plans to 4 months.
  Try our health insurance comparison tool to see if a short – term plan is the right fit for you.

Current Trends in Short – Term Health Insurance Premiums

In today’s dynamic healthcare landscape, staying informed about short – term health insurance premium trends is crucial for both consumers and industry professionals. A significant shift is occurring, which has far – reaching implications for everyone involved.

Contraction of short – term limited duration (STLD) plans

The short – term limited duration (STLD) plans are undergoing a notable contraction. Before 2025, Trump – era rules allowed individuals to remain in STLD plans for up to three years. However, new rules for 2025 will reduce the maximum allowable duration to just four months (Drivers of 2025 Health Insurance Premium Changes Presentation at the NAIC Summer National Meeting). STLDs have long been attractive to healthy individuals due to their relatively lower cost. But this change in regulations is likely to have a ripple effect on the insurance market.
If STLD enrollees move to the individual market instead, it could slightly lower premiums in that segment. Consider a young, healthy individual who was previously on an STLD plan. With the new duration limit, they may now opt for an individual market plan. This influx of healthy individuals into the individual market can balance the risk pool and potentially lead to more stable premiums. Pro Tip: If you’re currently on an STLD plan, start researching individual market options well in advance of your plan’s expiration to avoid any coverage gaps.

Medical trend factors

PwC projects an 8% year – on – year medical cost trend in 2025 for the Group market and 7.5% for the Individual market. This upward trend is driven by inflationary pressure, prescription drug spending, and behavioral health utilization. For example, the increasing cost of prescription drugs is a major contributor to this rise. Many new and specialized medications are hitting the market, and their high prices are reflected in insurance premiums.
As recommended by industry experts, consumers should review their prescription drug coverage regularly. If a particular drug is becoming too expensive under their current plan, they can explore alternative drugs or insurance plans that offer better coverage for those medications. Key Takeaways: Keep an eye on inflation and drug price trends, and be proactive in managing your prescription drug costs to mitigate the impact of rising premiums.

Employer expectations for healthcare costs

Employers are also facing challenges when it comes to healthcare costs. An actuarial firm Milliman reported that the average value of general enrollment MA plans dropped 6% this year, as benefits became leaner while premiums stayed the same. This means employers are getting less value for their money.
For employers, it’s essential to benchmark their healthcare costs against industry standards. By comparing their spending with similar businesses, they can identify areas where they may be overspending. Top – performing solutions include implementing wellness programs that can reduce overall healthcare costs in the long run. For instance, a company that introduced a fitness program saw a decrease in absenteeism and a reduction in health – related claims. Pro Tip: Employers should consider collaborating with insurance providers to customize plans that meet their employees’ needs while controlling costs. Try our cost – comparison tool to see how your company’s healthcare spending stacks up against industry benchmarks.

FAQ

What is short – term health insurance?

Short – term health insurance is a type of coverage that offers quick and temporary protection, typically lasting from 1 to 12 months (though new rules limit it to 4 months after September 1, 2024). It’s known for rapid enrollment, affordable premiums, but has significant limitations. Detailed in our [Pros and Cons] analysis, it suits specific transitional or budget – tight situations.

How to enroll in short – term health insurance quickly?

According to industry data, to enroll fast, gather necessary documents like ID and medical history upfront. Compare multiple providers, as recommended by insurance comparison tools. Many short – term plans allow for rapid enrollment, getting you covered within days, unlike some long – term plans. Check our [Quick enrollment and immediate coverage] section for more.

Short – term health insurance vs traditional long – term health insurance: What’s the difference?

Unlike traditional long – term health insurance, short – term plans offer quick enrollment, often within days. They also have lower premiums, commonly 20% less according to the Kaiser Family Foundation. However, they exclude pre – existing conditions and have limited coverage for services like preventive care. See [Limitations of Short – Term Plans] for more details.

Steps for determining if short – term health insurance is appropriate for you?

First, assess your situation. If you’re in a transitional period like between jobs or waiting for other insurance, it might be suitable. Also, consider your budget; if it’s tight, short – term plans are more affordable. But if you have chronic conditions, it’s likely not a good fit. Our [When is Short – Term Health Insurance Appropriate?] section elaborates.