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What Is Short Term Health Insurance?

Man looking at short term insurance on his laptop
Wondering what short term health insurance is?  Don't quite understand how it is different from traditional health insurance?  For a more concise understanding of what short term health insurance is, and how it works, read on.

Short Term Health Insurance provides coverage for medical illnesses or accidents - just like traditional health insurance.  The key difference between short term insurance and traditional health insurance has always be denoted by the product name - "short term".  Initially, short term insurance was created for the circumstance where someone knew they would only need coverage for a short period of time.  An example would be an employee or student that expected to be covered under a group health insurance plan after a 6 month or 1 year waiting period was completed.  This person would purchase a short term insurance plan for a pre-determined term length that exactly matched the group plan waiting period.

Short term plans were also known to feature benefits that were significantly less comprehensive than the benefits of traditional health insurance.  Short term plans were considered a "bare bones" health insurance option.

That was how things used to be.  There are now short term plans that can be held for up to three years before a new application is needed.  And the benefit structure is starting to look a lot like traditional health insurance plans, with some plans offering a list of benefits that are quite comprehensive.

It's important to note that while short term plan benefits are more comprehensive than ever before, they still are not the equal of a traditional Affordable Care Act health insurance plan.  Affordable Care Act plan benefits are superior in almost every category.

Good to know:  Many plans don't provide drug benefits, or discounts, even on generics, until you reach your deductible, which is often in the thousands of dollars.  Instead of just accepting your insurance plan's lousy prescription drug benefit, try using websites such as or to shop around for the best price for your medication in your area.
The obvious advantage of a short term health insurance plan is price.  The monthly premium of a short term health insurance plan can be significantly lower than the cost of a traditional health insurance plan.  In many circumstances, today's short term plan can be an ideal, affordable, health plan fit for individuals or families.

Have additional questions?  Give us a call.

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The Viability of Short Term Health Insurance.