If you are between jobs or needing coverage for only one to three months, a short-term health insurance policy can fill the gap. Under the ACA you can endure a 90-day (longer in some states) period without any health insurance coverage and not incur a tax penalty at year-end. Yet for many, going without health insurance is too risky. Short-term policies provide peace of mind to cover temporary coverage gaps at a fraction of the price of more permanent health insurance.
A short-term plan is intended to provide coverage for a new illness or injury that might arise during temporary periods when other coverage is not available. A broken bone and cut finger are examples of common injuries that can occur unexpectedly. You do not want to be caught uncovered in the event of an unexpected accident or illness.
Unlike longer-term health insurance plans, short-term plans do not cover:
- Preventive services (e.g., annual exams)
- Pre-existing conditions
- Travel outside of the United States
A short-term health insurance policy is an affordable solution to meet a temporary need. Here are some common situations where a short-term policy can effectively fill a coverage gap:
- Individuals waiting for an individual policy to be issued
- College students needing coverage during summer months or students taking a term off
- 64 year olds needing a few months coverage prior to Medicare eligibility
- Recent graduates in need of coverage before a new job
- Employees between jobs, on leave from work, or recently laid off
- Employees waiting to meet their probationary period
- Individuals starting a new business
This web site may contain concepts that have legal, accounting and tax implications. It is not intended to provide legal, accounting or tax advice. You may wish to consult a competent attorney, tax advisor, or accountant.