Short Term health insurance, sometimes called Emergency health
insurance or Temporary health insurance, is designed to bridge gaps in
your health care coverage during times of transition.
Who Should Consider Short Term Insurance Plans?
Short Term health insurance plans make sense for people who are:
- Under 65 and in good health
- Rolling off their parent’s insurance
- Inbetween jobs
- Without health insurance, have missed Open Enrollment and do
not have a qualifying event for Special Enrollment
- Waiting for your Affordable Care Act (ACA) coverage to begin
- A college student or just out of school
- Waiting for benefits to begin at a new job
- Waiting for Medicare
- Needing a temporary alternative to COBRA insurance
- Losing coverage following a divorce
Outside of the individual market’s annual open enrollment period a
short-term health insurance policy will likely be the best choice for
most applicants who are shopping for coverage without a qualifying
event. Short term plans generally provide the most comprehensive
coverage available outside of open enrollment.
Short term policies have been around for a long time and unlike
regular individual major medical plans, short term health insurance
policies are not regulated by the Affordable Care Act and their sale is
not limited to open enrollment windows.
So while they are still a good option for people who need coverage for
just a few months before another policy begins, they are also available
for consumers who might prefer a traditional major medical plan but
missed open enrollment.
Short Term Insurance Plans and the ACA Federal Tax
Short Term health insurance plans do not meet the minimum essential
coverage requirements under the Affordable Care Act (ACA), also
known as Obamacare, and may result in a tax penalty. They are
designed solely to provide temporary health care insurance during
unexpected coverage gaps. To avoid the risk of penalty, apply for an
ACA health insurance plan as soon as you qualify.
- immediate individual and family coverage,
- coverage range 30 days to 6 months
- number of days you will need to be covered
- may allow you to make a single payment for the whole coverage
- typically offered with a selection of premiums, deductibles and
benefit maximums (policies are considerably less expensive than
ACAcompliant major medical plans)
- cover a range of physician services, surgery, outpatient and
- choice of doctor and hospital without restrictions, though there may be financial incentives for using in network providers
Benefits for unexpected medical care
Short term health insurance benefits vary by plan, but covered
expenses often include:
- Hospital room, board and general nursing care
- Intensive or specialized care
- Emergency room treatment
- Inpatient doctor visits
- Ambulance, ground or air services
- Knee injury or disorder
- Gallbladder surgery
- Organ, tissue, bone marrow transplants
- Doctor office visits
- Outpatient hospital surgery or ambulatory surgical center
- Surgical services
- Administration of anesthetics
That means your short term health insurance benefits can help with a
range of medical bills—the ones that arise due to emergency care and
hospitalization due to serious events like heart attack or stroke, as well
as the less serious but still necessary ones related to a broken leg,
sprain, concussion or doctor’s office visit due to illness.
All short term health plan benefits are subject to the deductible,
copayment and coinsurance amounts, and maximum associated with
the plan you select.
What short-term health insurance won’t cover
Short term major medical plans weren’t designed to cover everything,
and they do not provide coverage for all of the ACA’s essential benefits.
Because short term health insurance plans are intended as temporary
coverage, they predominantly include benefits for unexpected injuries
and illnesses. However, some plans include a few preventive care
benefits—though, nothing as comprehensive as the essential health
benefits required of ACA compliant coverage.
Be sure to check the list of exclusions on any policy. Short term
major medical may not be available in all 50 states.