short term health plansShort term health plans offer health coverage for a limited period of time — typically between 30 days and 12 months.   They are designed to protect their enrollees while they are in transition between more comprehensive health coverage, and not intended to serve as permanent coverage.

Unlike Obamacare plans or other ACA compliant Health Plans, short term health plans will not cover pre-existing conditions.  They also do not typically cover preventive care, pregnancy, maternity, immunizations, vision, or dental care.

The Benefits of Short Term Health Insurance

As mentioned above, short term health coverage is intended to be used when in transition between comprehensive health insurance coverages for limited durations of time, however, some shoppers do value them as an affordable option and renew them when possible as short term plans tend to have much more affordable monthly premiums than most Obamacare or other ACA compliant health plans.

Typically short term health plans cover: 1) unexpected illness or injury 2) inpatient and outpatient hospital services and 3) emergency room visits.  Many times short term plans also provide discounts for doctors appointments etc.

When Do Short Term Plans Make The Most Sense?

Short term health insurance plans are not intended to be permanent nor do they meet the requirements of the Affordable Care Act, which means you cannot rely on these plans to avoid a tax penalty. However short term plans make a lot of sense in the following cases:

  1. You missed the open enrollment window and are not eligible to purchase a plan during the Special Enrollment Period (SEP)
  2. You are in between jobs, and you expect to be provided employer sponsored health insurance coverage at your next job.
  3. You are waiting for Medicare coverage to begin

There are plenty of other situations where short term plans might be right for you, but the situations listed above are some of the most common.

Other related information you might be interested in: Qualified health plans, off-exchange plans, individual coverage options, Understanding short term health plans (ebook)