Short-term health insurance
Short-term health insurance is temporary medical coverage meant to fill a gap between comprehensive plans. It may pay for some doctor, hospital, or emergency care, but it can exclude pre-existing conditions and essential health benefits, set benefit limits, and end without guaranteed renewal. The policy and state law decide what the insurer pays.
Also called: short term policy, limited benefit insurance
If you are between jobs or waiting for employer coverage to start, a short-term plan can look like a low-cost bridge. What it changes for you is the scope: it is not required to include the full set of Affordable Care Act protections, so a condition you already have, a prescription, or a pregnancy may fall outside it. The federal name is short-term, limited-duration insurance, or STLDI, and your state may limit or prohibit it altogether. Connecticut and New York both change the answer.
How the costs work on a short-term plan
You pay the premium every month, then a deductible and coinsurance when you use care, just as on other health plans. A lower premium does not mean a lower total cost; short-term plans typically pay a smaller share of care, which can leave you with more of each bill, according to the NAIC (opens in a new tab). The figures in this example are illustrative, not a quote or an average.
Hover or tap a row to highlight it.
| Step | Amount |
|---|---|
| Premiums ($300 a month x 3 months) | $900 |
| Covered, allowed medical claim | $10,000 |
| Your deductible, paid first | $2,500 |
| Remaining after deductible ($10,000 minus $2,500) | $7,500 |
| Your 20% coinsurance on $7,500 | $1,500 |
| Insurer pays 80% of $7,500 | $6,000 |
| Your medical cost ($2,500 plus $1,500) | $4,000 |
| Your total with premiums ($900 plus $4,000) | $4,900 |
That result falls apart if the claim is excluded, involves a pre-existing condition, uses a provider outside the plan's network, runs past a benefit limit, or is not medically necessary under the contract. In any of those cases you can owe far more than $4,900. Our coinsurance entry and out-of-pocket maximum entry explain how those pieces work on comprehensive plans for comparison.
Duration, renewal, and benefit limits
Federal rules and the policy itself set how long coverage lasts and what it leaves out.
- Initial term. Under 45 CFR § 144.103 (opens in a new tab), the stated expiration date can be no more than three months after the original effective date.
- Total duration. Including renewals and extensions, the federal definition caps total duration at four months. In an August 7, 2025 statement, the federal Departments of Labor, HHS, and Treasury (opens in a new tab) said they do not intend to prioritize enforcing that 2024 definition while future rulemaking is considered, and state law can be stricter.
- Renewal. Short-term coverage is not generally guaranteed renewable. A new policy can require a new application and medical underwriting.
- Underwriting. Where state law allows, an insurer may review your health history, decline you, or charge more.
- Benefits. A plan may cover some doctor, hospital, and emergency services, but it can exclude pre-existing conditions, set annual or lifetime limits, and limit prescription drugs, maternity care, mental health care, or preventive care, according to the NAIC (opens in a new tab).
- Cost sharing. Deductibles, copays, coinsurance, networks, and benefit maximums vary by policy, so confirm each figure in the policy schedule and benefit description.
Short-term premiums do not qualify for advance premium tax credits or Marketplace cost-sharing reductions, and federal surprise-billing protections may not apply, which can leave you exposed on out-of-network emergency charges, according to CMS (opens in a new tab).
Where you see the term
Short-term coverage belongs to health insurance only. You'll meet it on a quote, application, enrollment form, or marketing material, on the first page of the policy or certificate, in renewal or reenrollment documents, and in claim letters that cite the policy's limits. The federal rule requires a notice on the first page and in marketing, application, enrollment, and reenrollment materials stating that the coverage is temporary and is not comprehensive health insurance. The declarations page, exclusions, benefit schedule, and any rider or endorsement set what the plan actually pays.
How Connecticut and New York change it
Connecticut bars pre-existing-condition provisions in individual and group health plans and bars refusing to issue an individual plan solely because of a pre-existing condition under Conn. Gen. Stat. § 38a-476 (opens in a new tab). Public Act 19-134 (opens in a new tab) removed the former short-term-policy exception effective January 1, 2020, so a short-term policy offered to a Connecticut resident is measured against that rule and the actual policy form.
New York prohibits short-term limited-duration plans in both the individual and group markets, regardless of federal changes, under New York DFS Insurance Circular Letter No. 7 (2018) (opens in a new tab). New York law requires guaranteed renewability and comprehensive coverage, which short-term plans do not meet.
Questions to ask an agent or insurer
- What is the exact expiration date, and is renewal guaranteed? Federal short-term coverage is time-limited, and state law or the contract can restrict renewal.
- Does the policy exclude any pre-existing condition, including symptoms, related treatment, or complications? Short-term plans can use medical underwriting and exclude conditions that comprehensive coverage must cover.
- Which essential health benefits are excluded or limited, including prescriptions, maternity, mental health, preventive care, emergency care, and hospitalization? Short-term plans are not required to include the full ACA benefit package.
- What are the deductible, coinsurance, copays, benefit maximums, exclusions, and out-of-network rules? The premium alone does not tell you your total cost after a claim.
- Is this policy legal and available where I live, and does it count for federal financial assistance? State rules change availability, and short-term premiums do not qualify for Marketplace subsidies.
Frequently asked questions
Short answers on how this differs from Marketplace coverage and where it is sold.
Is short-term health insurance the same as a Marketplace plan?
No. Short-term coverage sits outside the federal definition of individual health insurance coverage, so it is not required to provide the same ACA protections or benefit package, according to CMS (opens in a new tab). Comprehensive individual-market coverage generally cannot exclude pre-existing conditions, according to HealthCare.gov (opens in a new tab).
Which other states prohibit short-term plans?
California has prohibited the product since January 1, 2019, according to the California Department of Insurance (opens in a new tab). New Jersey bars selling these plans to individuals regardless of policy length, under New Jersey Bulletin 18-12 (opens in a new tab). Other states may set shorter terms or added requirements, so confirm with your state insurance department.
What happens when a short-term plan ends?
Coverage stops on the expiration date unless the policy and state law allow renewal. A replacement short-term policy can require a new application and medical underwriting, and the insurer may decline it or price it differently.