Short term health coverage is just what it sounds like, it is temporary medical coverage. With renewals, you can use short term health coverage for up to 36 months. However, providers can limit you to 12 months.
These plans do not need to meet the Affordable Care Act requirements. While traditional plans must cover essential services, temporary health insurance plans do not.
The 10 essential services that health insurance plans must cover in order to meet the ACA requirements are as follows:
- Outpatient care.
- Hospitalization (inpatient).
- Mental health.
- Prescription drugs.
- Preventive care.
- Pediatric (including dental and vision care)
- Pregnancy, maternity, and newborn care.
Short-term insurance plans are not guaranteed to cover these services. However, even cheap short term health insurance may cover some of these essential services.
However, there are often limitations and exclusions whenever a short-term plan covers an essential service listed above. Similarly, the costs for these services are often higher than traditional insurance plans.
The benefit of short term health insurance is that it provides coverage when you need it. Traditional plans through the Marketplace do not allow you to sign up unless it is during open enrollment during the end of the year or when you have a qualifying event.
You can sign up for short-term plans at any time. For instance, if you leave your job in the spring and have another job lined up for fall, you may need healthcare coverage during the summer only. You are not able to sign up for a traditional plan during this time.
If you cannot afford to purchase coverage on your own, you may be able to sign up for free or near-free medical coverage through a government program.