Health Insurance 101: Is Short Term Health Insurance a Good Idea?

Updated on July 20, 2020
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It’s essential to have health insurance to make sure you’re always covered. Your health is essential to keeping you on track and feeling good. Not to mention, an accident or injury could occur at any time, and you’ll need medical services.

According to studies, approximately 27.9 million Americans are uninsured, but they don’t have to be. While standard health insurance is the most common, short-term medical insurance is beneficial as well.

You might be thinking, “Is short-term health insurance a good idea”? Keep reading the information below to discover if it’s right for you.

What is Short Term Health Insurance?

Unlike traditional health insurance policies, a temporary health insurance plan consists of low-cost coverage. However, many short term plans are also low-coverage. They’re not meant to last forever, so the medical services are minimal.

Most plans are available for one year with the option to prolong the coverage for an additional year. You may even be able to get short-term medical insurance for up to three years. However, not all states allow temporary plans.

Is Short-Term Health Insurance a Good Idea?

Short term insurance is a great idea, but only for certain circumstances. It works great as a temporary solution for gaps in coverage if your regular insurance has stopped.

Most people who get short-term health insurance get it when they are between jobs, waiting for other medical coverage to start, waiting to become eligible for Medicare, need health insurance until open enrollment, or self-employed.

What Does Temporary Health Insurance Cover?

Every short term health insurance policy differs. Federal guidelines permit temporary providers to create their own coverage plan without any mandated requirements.

However, the most common services that are excluded from short-term plans are the following:

  • Mental Health services
  • Maternity care
  • Outpatient prescription
  • Substance abuse rehab

Some temporary insurance plans also provide more benefits, but they generally cost more.

Who Benefits Most From Short-Term Coverage?

A temporary medical policy has its advantages. Most people benefit from temporary coverage because it has low premiums. However, this type of plan should be reserved for individuals who are generally healthy.

Before enrolling in a short insurance policy, weigh the pros and cons. If you are someone who does not have a medical condition, then a temporary plan is basically a safety net in case there’s an emergency.

On the contrary, a person with ongoing medical conditions should not get a short-term plan. It won’t cover everything that you need, and your out-of-pocket expenses will likely be expensive, depending on the services you need. Also, short plans are best for individuals, not for families.

The biggest issue is that your health condition can change at any moment. You can have an accident that creates substantial injuries or be diagnosed with a medical condition out of the blue. Keep that in mind when deciding on a policy.

How Much Does a Temporary Insurance Plan Cost?

One of the biggest advantages of short-term plans is cost. Most temporary insurance premiums are less than $100 per month.

Yet, it’s important to note that the deductible, out-of-pocket expenses, and co-pays might be higher than traditional insurance. But they generally cover fewer services, so keep that in mind.

How to Choose a Short Term Policy

Getting a short-term policy should be done with careful consideration. Although it is a wonderful option, you should always be cautious when it comes to your health. Here are some things to do when shopping for temporary health insurance:

  • Read the fine print to see exactly what the plan covers
  • Understand the costs and how much you pay out of pocket
  • Check to see if there is a dollar cap on coverage. If so, that could mean there is a benefit maximum that will stop coverage after a certain amount
  • See if the plan covers your current primary care doctor, specialist, and hospital

By following those steps, it’ll help you make the best decision. With that in mind, the best short term medical insurance is a plan that gives you flexibility.

It’s best to find a policy that gives you the option to pay for what you use, instead of what you don’t.

The Advantages of Short Term Coverage

In addition to the inexpensive cost of short term insurance, there are other perks as well. If temporary coverage is allowed in your state, below are some of the additional benefits to take advantage of:

Immediate Coverage

Short term plans usually allow immediacy. Healthy applicants get instant health coverage with policies that begin the next day. You may also have the option to make one payment if you know how long you’ll need coverage.


The enrollment process for a temporary plan is quick and easy. Normally, enrollment only requires that you answer some yes or no questions regarding your health condition. However, there may be some pre-existing conditions that are excluded from coverage


Temporary plans also cover a wide variety of physician services, inpatient and outpatient care, and surgery. Furthermore, some policyholders can select their own primary doctors and hospitals. But it may cost less if you pick in-network providers.

Get the Insurance Coverage That Suits You Best

Is short-term health insurance a good idea? Absolutely. For some people, it’s a godsend that works perfectly for their lifestyle.

There are some downsides to a short term health policy, but some insurance is better than no insurance.

Did you enjoy reading this article? If so, take a look at the rest of our blog. We specialized in health-related news to keep our readers “in the know”. Take a look at more of our posts to continue learning.

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