Short-term or temporary health insurance provides health coverage for a limited period of time.
If you want to understand short-term health insurance and how it works, a great place to start is with our new eBook, 3 Steps to Understanding Health Insurance.
In a nutshell, short-term health insurance plans are designed to provide affordable, temporary health insurance. They do not meet the coverage requirements of the Affordable Care Act (ACA or “Obamacare”), which means they don’t protect you from the uninsured tax penalty in 2018. In 2019, the individual mandate will no longer apply, so those who do not have healthcare that meets ACA coverage requirements will not be facing fines for that reason. (Uninsured tax penalties at the state level may still apply).
As the data shows, short-term health insurance plans are affordable, and may provide quality health coverage for consumers who are waiting for coverage under an employer-based group health insurance plan to begin, or who are waiting for the next Open Enrollment Period (OEP) to buy their own major medical individual or family health insurance plan.
Be Aware: Insurance companies do not have to approve your application for short-term health insurance. In most instances, insurers can decline an application for short-term health insurance if you have a pre-existing condition.
The definition of pre-existing conditions varies by plan and company. In some instances, conditions that you do not know you have at the time of application could be considered a pre-existing condition that limits your coverage.