You can apply for a short-term health insurance policy at any time of year if your state allows short-term coverage. You can be denied coverage based on your health, unlike standard health insurance. On the application you’ll likely answer yes/no questions about medical conditions. A short-term health company could approve a policy but deny covering claims associated with pre-existing health issues. Insurers review claims to check whether the healthcare services were connected to pre-existing conditions. If they find a pre-existing condition is causing health problems, they could reject the claim or even drop your coverage at any time.
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If you need a temporary, budget-friendly health policy, a short-term health plan can be a solution. Since these policies typically include a network of healthcare providers, be sure you understand which doctors and hospitals are covered so you get the maximum plan benefits.
I suggest making sure you understand how long a short-term plan will last and whether it’s renewable. Short-term insurers can choose to make plans renewable and can set short policy lengths. That can play a part in which short-term plan you choose.
The plan’s deductible and coinsurance affect your out-of-pocket costs. I would choose a high deductible if you want a cheap, safety net plan, but go with a lower deductible and coinsurance if you expect to make more claims.
Many short-term plans don’t cover prescriptions. If that coverage is important to you, I’d suggest focusing on short-term plans with prescription drug coverage, such the UnitedHealthcare and Pivot Health plans highlighted on this page.
Source: Forbes Advisor research. Rates reflect the average for a 30-year-old woman who is a nonsmoker for the three lowest quotes in these cities: Orlando, Florida, Phoenix and El Paso, Texas.
See More See LessShort-term health insurance plans don’t have to follow ACA rules, which means there can be a significant difference between what one policy covers compared to another.
Short-term health insurance plans may cover:
Short-term health insurance plans aren’t governed by Affordable Care Act requirements, so each company decides what it does not cover. Make sure to check the policy for lists of exclusions. Examples of typical exclusions are:
Insurance Lead Editor
Insurance Managing Editor
Joshua C., Rochester, New York
Not everyone is eligible for short-term health insurance. Short-term plans may reject you because of pre-existing conditions. Short-term health insurance companies can deny coverage based on your medical history or choose not to cover any services associated with that pre-existing condition. Also, not all states allow these types of plans. New York is one of the states that I’ve found don’t allow short-term health plans.
Insurance Lead Editor
Zack P., Cape Coral, Florida
Short-term health insurance might be an option when you’re young. One example is when you turn 26 and are no longer eligible to be on a parent’s health plan. Short-term plans are low cost, but I would suggest that you remember they also don’t offer nearly as much coverage that’s in standard health insurance. You’ll want to look closely at the plan’s details to see what it covers and any limitations before buying a short-term health plan.
Insurance Managing Editor
Kendra B., Alvin, Texas
I’ve found that short-term health insurance may be a more affordable solution if you only need coverage for a short period, you’re young and healthy, and you don’t generally need many healthcare services. Short-term plans are cheap but they come with limited coverage, so beware that prescriptions, mental health services and maternity care are not often covered by short-term plans. COBRA plans offer much better coverage but it’s also much more expensive.
Roberta H., Port Huron, Michigan
Short-term health plans don’t have to cover prescriptions, but some do. Two examples are UnitedHealthcare’s Copay Select Max and Pivot Health’s Epic Base plan. I suggest reading the fine print to understand a short-term plan’s prescription benefits and what types of drugs it does and does not cover.
To identify the best short-term health insurance companies, we evaluated companies based on average monthly cost, coverage and out-of-pocket costs:
Short-term health insurance rates (25% of score): We compared quotes for a 30-year-old woman who is a nonsmoker for three cities: Orlando, Florida, Phoenix and El Paso, Texas. We took the three lowest quotes for each plan in each city and came up with an average.
Coverage maximum (25% of score): Unlike standard health insurance, a short-term health insurance plan has maximum coverage, either lifetime or annual, which is the most the company will pay for an individual’s care.
Deductible (20% of score): Short-term health insurance companies often offer multiple health insurance deductible levels. Plans with more options got more points in our analysis.
Coinsurance (15% of score): Coinsurance is the percentage you pay for healthcare services after you reach your plan’s deductible. The insurer picks up the rest of the bill until you reach the coverage limit. Lower coinsurance levels mean less money out of pocket, so we gave those plans more points.
Prescription drug coverage (15% of score): Many short-term health insurance plans don’t offer prescription drug benefits or only give a discount card for members. We analyzed which short-term plans offer prescription drugs, which ones do not and which have exclusions that only cover prescription drugs for specific reasons, such as only during hospitalizations.
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Short-term health insurance offers low-cost, limited coverage if you have a coverage gap, but detractors often call the plans junk health insurance because they lack many coverage types found in regular health insurance. Pros of short-term health insurance are its low cost, you can apply for a plan at any time, you can get coverage quickly and you may have more flexibility to decide on your out-of-pocket costs compared to a standard health insurance plan. Cons include that short-term plans don’t typically offer coverage that is in standard health insurance plans, don’t generally cover pre-existing conditions and you can be denied.
COBRA insurance and short-term health insurance both let you have coverage for a limited time but they differ in many ways. The COBRA law requires insurers to provide a temporary continuation of your same health insurance. There is a major drawback, though: The employer will likely no longer cover part of the monthly premium. You instead have to pay the full premium, plus an administrative fee. Short-term health insurance isn’t connected to your employment. Short-term plans also don’t typically cost anywhere near what COBRA does, but you don’t get comprehensive coverage typically found in an employer plan.
A short-term health insurance plan might make sense if you can’t find affordable health insurance anywhere or you will soon have health insurance, such as starting a new job. It could also work as an emergency stopgap if you were recently laid off and can’t afford COBRA insurance.
You can get short-term health insurance directly from the company if your state allows those plans. Unlike the Affordable Care Act health insurance marketplace at HealthCare.gov, you’re not able to compare short-term plans available in your area in one location. You instead have to go directly to each company to get details.
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Deputy Editor, InsuranceLes Masterson is a deputy editor and insurance analyst at Forbes Advisor. He has been a journalist, reporter, editor and content creator for more than 25 years. He has covered insurance for a decade, including auto, home, life and health. Before covering insurance, Les was a news editor and reporter for Patch and Community Newspaper Company and also covered health care, mortgages, credit cards and personal loans for multiple websites.
Insurance and Credit Card ExpertInsurance and credit cards expert Laura Adams is one of the nation’s leading personal finance and small business authorities. As an award-winning author of multiple books, keynote speaker, host of the "Money Girl" podcast (more than 42 million downloads) since 2008, and founder of The Money Stack newsletter, Laura offers practical advice that benefits millions of readers, listeners and loyal fans. She was named one of Empower's "Top 50 Women in Personal Finance" in 2018.
Laura's podcast inspired her first book, "Money Girl's Smart Moves to Grow Rich," which won the 2011 EIFLE (Excellence in Financial Literacy Education) award. Her latest title, "Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers" (Entrepreneur Press), was an Amazon No. 1 new release.
Laura is a trusted source for national media outlets, which frequently seek her practical advice on insurance, credit cards and various other financial topics for TV, radio, online articles and print publications. She’s been featured on most major news outlets including ABC, Bloomberg, CBS, Consumer Reports, Forbes, Fortune, Fox, Money, MSN, NBC, NPR, The New York Times, USA Today, U.S. News & World Report, The Wall Street Journal and The Washington Post.
Her mission is to empower consumers to live healthy and rich lives by making the most of what they have, planning for the future, and making smart money decisions.
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