5 things to know about short-term health insurance in 2024

Are you looking for short-term health insurance?

You know, temporary coverage to protect your health (and your pocketbook) until things settle down and look a little more “normal.”

• Maybe you’re in between jobs
• Maybe you missed the Open Enrollment Period for the Affordable Care Act and ACA plans
• Maybe you got dropped from previous coverage because of a divorce, death, move

Any of these situations can be stressful. You know you need health insurance, but it may not be something you have the time or energy to shop around for.

Sound familiar?

Short-term health insurance can help you.

• These plans can provide you with health coverage for a limited amount of time when you don’t have a traditional health insurance plan.
• While short-term plans have long been a popular option, new regulations by the federal government have changed some things about how it works.¹

Here are 5 things to know about what is (and isn’t) changing about short-term medical plans in 2024.

1. You can only use short-term plans for 4 months

Prior to 2023, you could buy a short-term health insurance plan for up to 12 months in some states, and then renew it 2 more times — which meant that you could have it for 3 years total.

But new rules finalized earlier this year have changed that.

According to the Centers for Medicare & Medicaid Services:²

• The new rules for short-term health insurance “limit the length of the initial contract term to no more than three months and the maximum coverage period to no more than four months.”

This may work if you only have a short time where you’re uninsured — for example, a couple of months while you’re in between jobs, says Tasha Riggs, a licensed insurance agent for HealthMarkets based in Westminster, Colorado.

What if you need health insurance for longer than 4 months?

• You may run into problems when your short-term insurance expires, says Riggs.
• That’s why, if you think you may need insurance for more than a few months, Riggs recommends that you buy an ACA insurance plan.

2. Short-term health insurance plans aren’t required to cover preexisting conditions

Affordable Care Act plans offer essential benefits, such as prescription drug coverage.

And by law, insurers can’t deny you coverage for preexisting conditions, such as cancer or type 2 diabetes.³

But those same rules don’t apply to a short-term health insurance plan.

• They can deny you coverage if you have a preexisting condition.
• You may also have to undergo medical underwriting, where you fill out a health questionnaire and provide all of your recent health records.

According to the Centers for Medicare & Medicaid Services:²

Short-term health insurance plans are not subject to the prohibitions on discrimination based on:

• Health status
• Pre-existing condition exclusions
• Lifetime and annual dollar limits on essential health benefits

If you have a preexisting condition, that could disqualify you for short-term health insurance.

But you have a couple other options. You could:

• Purchase an ACA plan, OR…
• Extend your employer-sponsored insurance through COBRA.
• (COBRA stands for the Consolidated Omnibus Budget Reconciliation Act, which gives workers and their families who lose their health benefits the right to stay on their employer benefits for a limited time.)⁴

3. Short-term plans may not cover preventive care

Another one of those essential health services that ACA plans cover but short-term medical plans may not: preventive care.

Short-term health insurance is not required to comply with certain federal market requirements regarding coverage for things like:¹

• Preventive care
• Emergency services
• Hospitalization
• Prescription drugs
• Mental health services
• Substance use disorder services

If these services are important to you, you’ll want to check your short-term plan’s benefits carefully to see what’s covered.

• You may also want to shop around to see if there’s a short-term plan that does meet your immediate needs.
• You can do so by browsing your options online today.

4. Get coverage fast with a short-term health insurance plan

You can’t always predict when something might happen that causes you to lose your health insurance.

But if you do, what’s your plan for health insurance?

Here’s some good news: A short-term plan may be able to get you health insurance coverage almost immediately.

A short-term plan could start as soon as the day after you apply, notes Riggs. That’s why if you need quick, temporary insurance between jobs, a short-term plan may be helpful.

In most cases, a short-term health insurance policy becomes active within a few days after the application is received.⁵

5. Short-term health insurance plans may cost less than traditional plans

If cost is high on your list, here’s something to consider: short-term plans tend to cost less than comprehensive health insurance plans.¹

• That’s why, if you’re healthy and just need something for a month or so, a short-term plan may be a more attractive option, notes Riggs.

Just be aware that some plans also have dollar limits on covered benefits and are subject to pre-existing limitations and exclusions.

• If you become seriously ill or have a major accident, short-term insurance may not offer enough coverage.

Looking for short-term health insurance?

Based on new federal regulations, short-term health insurance can help you fill a gap with no insurance for about three months. If that’s what you need, we can help.

You can review your options for short-term health insurance here, or give us a call at (800) 827-9990 to talk with a licensed insurance agent.