Short-term health insurance sounds appealing when you need a quick coverage gap fix, but in 2026 the rules vary dramatically by state. Fifteen states (including Washington D.C.) either ban these plans outright or have regulations so strict that no insurer sells them. In the remaining states, federal rule changes under the current administration have reopened the door to plans lasting up to 36 months, reversing the Biden-era limit of 4 months. Before you buy, you need to know what your state allows, what these plans never cover, and when an ACA marketplace plan is the smarter call.
Quick Answer: As of 2026, short-term health insurance is unavailable in at least 15 states and D.C. In states where plans are sold, coverage typically excludes pre-existing conditions, maternity care, mental health treatment, and prescription drugs. Federal rules now allow plans up to 36 months again, but state rules often set tighter caps. If you have any ongoing health conditions or want comprehensive coverage, an ACA marketplace plan protects you far better.
What Is Short-Term Health Insurance?
Short-term limited-duration insurance (STLDI) is a category of health coverage that sits outside the ACA's guaranteed consumer protections. Because these plans are not classified as "major medical" coverage under the Affordable Care Act at healthcare.gov, insurers selling them are free to:
- Deny you based on medical history
- Exclude pre-existing conditions entirely
- Skip essential health benefits like maternity, mental health, and prescriptions
- Cancel coverage mid-term in some cases
- Set dollar caps on total benefits paid
The premiums run 50 to 80 percent lower than ACA marketplace premiums, which is why people buy them. But the coverage is fundamentally different, and the price difference often reflects an enormous coverage gap you may not discover until you file a large claim.
Federal Rules in 2026: Up to 36 Months Again
The Biden administration limited STLDI plans to a maximum of 4 months total duration (initial term plus renewals), effective for plans sold after September 1, 2024. That rule also required insurers to give buyers a prominent disclosure comparing STLDI coverage to ACA-compliant plans.
The Trump administration reversed course in August 2025. Per a U.S. Department of Labor statement, the federal government announced it would not enforce the 4-month limit and would restore the prior rule allowing:
- Initial coverage period of up to 12 months
- Total duration including renewals of up to 36 months
This matters because many states set their own, stricter limits. The federal rule is the floor; states can go tighter.
States Where Short-Term Health Insurance Is Unavailable in 2026
The table below reflects the current landscape. States marked "Banned" have laws explicitly prohibiting STLDI sales. States marked "Unavailable" have regulations strict enough that no insurer currently offers plans there, per healthinsurance.org tracking as of 2026.
| State | Status | Notes |
|---|
| California | Banned | SB910 (2018) banned STLDI sales as of Jan. 1, 2019 |
| Colorado | Unavailable | Strict state rules; no insurers offer plans |
| Connecticut | Unavailable | State regulations prevent market entry |
| District of Columbia | Unavailable | Regulations effective; no plans sold |
| Hawaii | Unavailable | No insurers offer STLDI |
| Illinois | Unavailable | Restrictions tightened 2025; no available plans |
| Maine | Unavailable | State law limits plans; market exited |
| Massachusetts | Banned | State law prohibits sale of STLDI |
| Minnesota | Unavailable | No insurers offer plans under state rules |
| New Jersey | Unavailable | State regulations prevent STLDI sales |
| New Mexico | Unavailable | Limited to 3 months, no renewals; no insurers offer plans |
| New York | Banned | State law prohibits STLDI sales |
| Rhode Island | Unavailable | Regulations strict enough to exit market |
| Vermont | Unavailable | 2018 law limits duration; no insurers offer plans |
| Washington | Unavailable | Plans allowed up to 3 months; no insurers participate |
If you live in any of these states and need coverage, your options are ACA marketplace plans, Medicaid (if you qualify by income), or COBRA if you recently left employer coverage. Check your eligibility now at CoveredUSA, it takes 2 minutes.
States with STLDI Available but Restricted
In the 36 states where short-term plans are sold, state rules vary on duration, renewals, and required disclosures. Three states had already set 3-month limits independently of the federal Biden-era rule:
| State | Duration Limit | Key Restriction |
|---|
| Delaware | 3 months | State-set cap, no renewals |
| Maryland | 3 months | State-set cap |
| Oregon | 3 months | State-set cap, no renewals |
| All other permissive states | Up to 36 months (federal rule) | State may impose additional disclosure requirements |
States without their own rules now follow the current federal maximum of 36 months for plans sold or issued after the August 2025 non-enforcement announcement. The NAIC tracks state STLDI rules and updates them as legislatures act.
What Short-Term Plans Never Cover
This is the section that matters most. Regardless of which state you live in, STLDI plans sold in permissive states carry coverage gaps that do not exist on any ACA marketplace plan. As of 2026, these exclusions are standard across most STLDI products, per KFF's analysis:
Pre-existing conditions. STLDI plans can deny your claim for any condition you had before the policy start date, including conditions you were not yet diagnosed with. A back problem treated two years ago, a previous asthma diagnosis, a single hospitalization, cancer history, all fair game for denial.
Maternity care. ACA plans cover pregnancy and newborn care as an essential health benefit. STLDI plans almost universally exclude maternity services entirely.
Mental health and substance use treatment. The Mental Health Parity and Addiction Equity Act applies to ACA-compliant plans. It does not apply to STLDI. Plans routinely exclude or severely limit mental health coverage.
Prescription drugs. Many STLDI plans offer no drug coverage or only a small formulary. If you take maintenance medications for a chronic condition, expect to pay full price.
Preventive care. ACA plans cover preventive screenings and vaccines at no cost. STLDI plans are not required to do this.
Pediatric services. Vision and dental coverage for children is an ACA essential benefit. STLDI plans exclude it.
Dollar caps. ACA plans prohibit annual and lifetime dollar limits on coverage. STLDI plans can and do impose benefit caps, sometimes as low as $25,000 per year, far less than the cost of a major surgery or hospital stay.
ACA vs. Short-Term Health Insurance: Key Comparison for 2026
| Feature | ACA Marketplace Plan | Short-Term Health Insurance |
|---|
| Pre-existing conditions | Covered, no exclusions | Excluded; application can be denied |
| Essential health benefits | All 10 required (maternity, mental health, Rx, etc.) | None required; varies by plan |
| Annual/lifetime dollar caps | Prohibited | Allowed; often imposed |
| Out-of-pocket maximum | Required (2026 max: $10,600 individual) | None required |
| Preventive care | Free at in-network provider | Usually excluded |
| Subsidies available | Yes, based on income and FPL | No |
| Guaranteed renewable | Yes | No, can end at term |
| Duration | Continuous annual coverage | Up to 36 months federal; state limits vary |
| State availability | All 50 states + D.C. | 36 states; 15 states + D.C. unavailable |
When a Short-Term Plan Makes Any Sense
Short-term health insurance is rarely the best option, but there are narrow situations where it is used:
- You missed ACA open enrollment, do not qualify for a Special Enrollment Period, and are in good health with no ongoing prescriptions
- You are between jobs for a few weeks and need catastrophic coverage only
- You are under 26, recently aged off a parent's plan, and enrollment paperwork is pending
None of these situations apply if you have any pre-existing condition, take regular medications, are pregnant, have children who need pediatric care, or need mental health or substance use treatment. In those cases, the cost savings disappear the moment you make a real claim.
How to Apply for ACA Coverage Instead
If you live in a state where STLDI is unavailable, or if you have reviewed the coverage gaps and decided an ACA plan fits better, here is how to enroll in 2026.
Open enrollment for 2026 ACA marketplace plans ran November 1 through January 15, 2026. Outside that window, you need a qualifying life event (job loss, marriage, birth, move, etc.) to trigger a Special Enrollment Period (SEP).
Step-by-step ACA enrollment:
- Go to healthcare.gov (or your state's own marketplace if applicable)
- Create or log into your account
- Enter your household size, income estimate, and zip code
- Compare plans by metal tier: Bronze, Silver, Gold, or Platinum
- Confirm your tax credit (subsidy) amount based on your 2026 income
- Select a plan and pay your first premium before the coverage start date
Documents you will need:
- Social Security numbers for all household members
- Proof of income (recent pay stubs, prior year tax return, or income estimate)
- Employer coverage details if your job offers insurance
- Current health insurance information if you are switching
- Immigration documents if applicable
Common reasons ACA applications are delayed or denied:
- Income estimate does not match IRS data on file
- Social Security number mismatch
- Employer coverage reported incorrectly (affects subsidy eligibility)
- Missing dependent documentation
- Not providing a Special Enrollment Period qualifying event document when required
ACA Income Limits for Subsidies in 2026
ACA marketplace subsidies (premium tax credits) are available to households earning between 100 percent and 400 percent of the federal poverty level. The enhanced subsidies passed under the American Rescue Plan remain in effect for 2026, though the income caps have been under ongoing Congressional review.
The 2026 federal poverty level guidelines, published by ASPE at HHS, set the baseline used for subsidy calculations:
| Household Size | 100% FPL (2026) | 400% FPL (2026) |
|---|
| 1 | $15,960 | $63,840 |
| 2 | $21,640 | $86,560 |
| 3 | $27,320 | $109,280 |
| 4 | $33,000 | $132,000 |
| 5 | $38,680 | $154,720 |
| 6 | $44,360 | $177,440 |
| 7 | $50,040 | $200,160 |
| 8 | $55,720 | $222,880 |
| Each additional | +$5,680 | +$22,720 |
Source: HHS 2026 Federal Poverty Guidelines. Alaska and Hawaii have higher FPL thresholds.
If your household income falls below 100% FPL and your state has expanded Medicaid, you likely qualify for Medicaid rather than marketplace subsidies. See ACA income limits at coveredusa.org/aca-income-limits for the full subsidy breakdown by income tier.
Frequently Asked Questions
Is short-term health insurance legal in all 50 states in 2026?
No. As of 2026, at least 15 states and the District of Columbia either ban STLDI outright or have regulations strict enough that no insurer sells these plans. California, New York, and Massachusetts are among the states with outright bans. In the remaining states, short-term plans are legal but subject to federal and sometimes additional state duration limits.
Can short-term insurance deny coverage for a pre-existing condition?
Yes. Unlike ACA marketplace plans, short-term health insurance is not subject to the ACA's pre-existing condition protections. Insurers can deny your application or deny individual claims based on conditions you had before the policy started. This is one of the most significant coverage risks with STLDI.
How long can a short-term health plan last in 2026?
Under the current federal rules (following the Trump administration's August 2025 non-enforcement announcement), short-term plans can last up to 12 months for the initial term and up to 36 months total with renewals. However, several states set their own stricter limits, including Delaware, Maryland, and Oregon, which cap plans at 3 months.
Does short-term insurance count as minimum essential coverage under the ACA?
No. STLDI does not qualify as minimum essential coverage under the ACA. The federal individual mandate penalty was reduced to $0 starting in 2019, so there is no federal tax penalty for having only short-term coverage. However, having only short-term coverage does not protect you from the coverage gaps described above.
What happens if I get sick while on a short-term plan?
If your illness is linked to a condition you had before the plan started, the insurer can deny the claim. If the illness is genuinely new and not excluded, the plan may cover it up to any dollar cap in your policy. Once your short-term policy ends, you will typically need to apply for new coverage, and the condition you just developed becomes a pre-existing condition that new STLDI policies can exclude.
Who qualifies for a Special Enrollment Period to get ACA coverage?
You qualify for a Special Enrollment Period if you experience a qualifying life event: losing job-based coverage, getting married or divorced, having a baby, adopting a child, moving to a new coverage area, or losing Medicaid eligibility, among others. Losing short-term coverage at the end of a policy term can also trigger a SEP in many states. You typically have 60 days from the event to enroll.
How do I know if I qualify for Medicaid instead of ACA marketplace plans?
If your household income is below roughly 138 percent of the federal poverty level and your state has expanded Medicaid, you will likely qualify for Medicaid rather than marketplace subsidies. The coveredusa.org screener will check both programs simultaneously in about 2 minutes.
Are there ACA subsidies available for low-income households in 2026?
Yes. Households earning between 100 percent and 400 percent of the federal poverty level qualify for premium tax credits that reduce monthly premiums. Households earning under 250 percent FPL also qualify for cost-sharing reduction subsidies on Silver plans that lower deductibles and copays. Check your subsidy amount at healthcare.gov.
