Short-Term Health Insurance for the Self-Employed: Pros & Cons
What Is Short-Term Health Insurance?
Short-term health insurance plans provide limited medical coverage for periods typically ranging from 30 days to 364 days. They are underwritten based on health history and can be issued within 24–48 hours — making them popular for newly self-employed individuals between jobs or waiting for ACA open enrollment.
The Major Advantages of Short-Term Plans
- Low Premiums: A healthy 35-year-old can find short-term coverage for $80–$200/month vs. $400–$700/month for an ACA Bronze plan.
- Immediate Issuance: No waiting for open enrollment periods — apply and get covered within days.
- Flexibility: Month-to-month terms let you cancel when ACA coverage begins.
The Serious Risks You Must Understand
- Pre-existing Condition Exclusions: Any medical condition diagnosed before the plan starts is typically excluded from coverage.
- Annual and Lifetime Benefit Caps: Many short-term plans cap total benefits at $250,000–$1,000,000.
- No Essential Health Benefits: Short-term plans are not required to cover maternity care, mental health, or prescription drugs.
Frequently Asked Questions
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