The Pros and Cons of Short Term Health Insurance

by John Hansen

Gap Health Insurance Covers People While Waiting for Open Enrollment or for Employer Sponsored Coverage

Short term health insurance sales have gone up since the implementation of the Affordable Care Act (ACA). There has been a lot of upset in the market including people losing coverage and individuals needing gap health insurance to cover them while they’re waiting for Open Enrollment or waiting for their new job to start.

Due to Health Care Reform, now you can’t get enrolled on regular health plans outside of Open Enrollment without a life event. So for many they have only two options, go with short term health insurance or go without coverage.

There are various benefits to Short Term health insurance.

  • Gap Health Insurance: Perhaps you’re between jobs, and you just need some coverage for a month or two. Short term medical can fill the gap.
  • Quick and easy enrollment: Signing up for short term health insurance is quick and easy. In 5-10 minutes you can get quotes, choose a plan, apply and be done.
  • Affordable: Short term plans tend to be less expensive.
  • Flexible: You can modify your short term gap health insurance benefits to provide less or more coverage. Also, you can modify the length of coverage between one month and six months.

There are some drawbacks of Short Term health plans.

  • Don’t help you avoid the penalty: Short term plans do not have the 10 minimum essential benefits as described by the Affordable Care Act (ACA). So being on a short term health insurance plans won’t help you avoid the penalty for being uninsured.
  • Major medical coverage:  If you’re looking for just in case coverage, the short term plan is for you. But short term health insurance or gap health insurance plans usually lack many of the richer benefits you can get on regular health plans.