Short-term health plans vs ACA plans

A short-term plan can cost a fraction of a marketplace premium — because it is allowed to cover far less. Read what it excludes before you buy.

Why they are cheaper

Short-term limited-duration plans are not required to cover the ACA's essential health benefits, can exclude or charge more for pre-existing conditions through medical underwriting, can cap annual or lifetime benefits, may exclude prescription drugs, maternity care and mental health, and can rescind coverage if the application was inaccurate. They also cannot be bought with a premium tax credit, so the subsidy comparison is not apples-to-apples.

How long they last

Federal rules limit short-term plans to short durations (with renewals permitted under current rules in many states), but states can be stricter — some effectively ban them. Check your state's rules before relying on one.

When a short-term plan can make sense

Only as a bridge for someone healthy, with no pre-existing conditions, who needs temporary coverage between jobs or while awaiting an ACA plan start date — and who can afford the risk that a new condition will not be covered until the ACA plan begins. Never choose one knowing you need care: the exclusions are exactly where you would need the coverage.

The safer alternatives

Check for a special enrollment period (job loss, moving, marriage), Medicaid/CHIP eligibility (year-round), COBRA from a former employer, or a parent's plan if under 26. Compare the full cost of a subsidised silver plan against the short-term premium plus the deductible you would face if something happened.

Written and maintained by the US Health Insurance Marketplace data team · last reviewed 2026-10-24 · sources and methodology.