Short-Term Medical Insurance
What is Short-Term Medical (STM) Insurance?
Short-term medical insurance provides temporary health coverage for individuals who experience a gap in their regular insurance. It’s designed to protect against unexpected medical expenses during transitional periods, such as:
- Between jobs or waiting for employer benefits to start
- Missed ACA Open Enrollment or facing unaffordable rates in the ACA Marketplace.
- Recent graduates aging off a parent’s plan
- Freelancers, gig workers, or early retirees under 65
- People waiting for Medicare or special enrollment eligibility
Key Features:
- Coverage duration: The Trump administration issued a regulation in August 2025 that expands the availability of “short-term” health insurance plans that do not have to comply with any of the rules in the Affordable Care Act (ACA) for plans sold in the individual market. Specifically, the regulation allows short-term plans to be offered for up to 364 days and renewed at the discretion of the insurer for up to three years. (varies by state).
- Lower premiums than ACA plans (often 50–80% less)
- Quick enrollment (coverage can start next day)
- Flexible options for hospitalization, ER visits, and limited doctor visits
- Not ACA-compliant: Excludes pre-existing conditions, maternity, mental health, and many preventive services.
Who is the Target Market?
STM plans appeal to:
- Individuals between jobs or waiting for new coverage
- Self-employed professionals and gig workers
- Young adults transitioning from parental coverage
- Early retirees not yet eligible for Medicare
- Students and recent graduates
- Budget-conscious consumers who need temporary protection.
The market is growing due to:
- Rising healthcare costs (without enhanced subsides, consumers will face an average of 114% premium increase for 2026)
- Increasing gaps in coverage (30% of Americans experienced gaps in 2022)
- Growth of freelance and contract work
Why Should Agents Include STM in Their Portfolio?
- Year-round enrollment (no Open Enrollment restrictions)
- Competitive commissions and fast onboarding offered by carriers
- Cross-selling opportunities with supplemental products (dental, vision, accident, critical illness)
- Meets client needs for affordable, short-term solutions during life transitions
- Brand differentiation: Offering STM positions agents as problem-solvers for coverage gaps
Email Us
*In most states
**Not available in all states
Copyright ©2025 YourFMO.com, LLC. All rights reserved. For Agent use only. Rates are subject to change. Certain exclusions, restrictions and limitations may apply; please contact your marketer for more information. Not affiliated with the United States government or the federal Medicare program.