The pitch arrives in your inbox around open enrollment: health coverage for $87 a month, no network hassles, sign up in ten minutes.
For anyone staring down a $600 monthly premium on the ACA marketplace, that number is tempting.
It's also doing a lot of quiet work that the ad copy never explains.
Short-term health insurance is exactly what it sounds like: a temporary policy, typically lasting anywhere from one month to just under a year.
It was designed as a bridge — for people between jobs, waiting on employer coverage to kick in, or caught in a gap.
Insurers like UnitedHealthcare, National General, and a cluster of smaller carriers sell it aggressively online, often through comparison sites that earn a commission when you click "get covered." Here's where the math gets less flattering.
These plans aren't required to cover the ten essential health benefits that ACA plans must include.
That means no guaranteed coverage for prescription drugs, maternity care, mental health treatment, or substance abuse services.
Some policies cap how much they'll pay out per year — a $250,000 annual limit sounds generous until a single hospital stay blows past it.
Unlike ACA plans, short-term policies can reject you for pre-existing conditions.
Have controlled diabetes, a history of back surgery, or a past cancer diagnosis?
You may be denied outright, or approved with a rider that excludes anything related to that condition.
And if you get sick while covered, the insurer can review your medical history and rescind the policy if it finds something you didn't disclose.
Under current federal rules, these plans can last up to 364 days and, in some states, be renewed for up to 36 months total.
If you develop a costly condition during your term, the insurer can simply decline to renew — and now you're shopping for coverage with a fresh diagnosis on your record.
Insurers and lead-generation websites, mostly.
A short-term policy can be profitable precisely because it covers healthier people who use less care.
The people who get burned are the ones who buy it thinking it's real insurance, then discover the gap when they need it most.
A 2020 study in Health Affairs found that short-term plan enrollees were more likely to report problems paying medical bills than people with ACA coverage.
None of this means short-term plans are useless.
If you're healthy, between jobs for two months, and mainly want protection against a freak accident, a bridge policy can make sense.
Read the exclusions page before the price page.
Check whether prescriptions you take are covered.
And run the numbers on a subsidized ACA plan first — after tax credits, a lot of people find the "expensive" option is cheaper than they assumed.
The real question isn't whether $87 a month is a good deal.
Final Thoughts
Cheap coverage that vanishes the moment you need it isn't a bargain — it's a bet that you'll stay lucky.