Short Term Health Insurance Between Jobs: Cost, COBRA, and What to Choose
The gap between jobs is when people need coverage most
Losing a job or leaving one voluntarily usually ends employer-sponsored health coverage on the last day of the month you worked, or sometimes the last day of employment itself. That gap can be days, weeks, or months, and it coincides with a period of financial stress when an unexpected medical bill is especially damaging. Three main options exist: COBRA continuation, a marketplace special enrollment plan, or a short term health insurance plan. Each has a different cost structure and coverage profile.
What COBRA costs and what it covers
COBRA lets you keep your exact employer plan, but you pay the full premium yourself, including the share your employer was paying. For an individual, that often runs $500 to $700 a month. For a family, it can exceed $1,500 a month. Coverage is identical to your prior employer plan and includes all ACA-required benefits, no pre-existing condition exclusions, and an annual out-of-pocket cap.
COBRA's price looks high, but for someone with a pre-existing condition, ongoing prescriptions, or a known medical procedure coming up, it often delivers the best value because there are no coverage gaps or exclusions.
What a short term plan costs between jobs
A short term plan for a 35-year-old might run $90 to $180 a month for a mid-range deductible and a $250,000 to $500,000 benefit maximum. That is frequently 60 to 80 percent cheaper than COBRA. The trade-off is narrower coverage: pre-existing conditions may be excluded, prescriptions may not be covered, and there is usually no annual out-of-pocket cap. For a healthy person with no ongoing medical needs and a short expected gap, those exclusions may not matter much in practice. Use the short term health insurance cost calculator to estimate what a plan would cost for your age and the likely length of your gap.
Cost comparison at a glance
| Option | Typical monthly cost (individual) | Pre-existing conditions covered? | Rx covered? |
|---|---|---|---|
| COBRA | $500 to $700 | Yes | Yes |
| Marketplace plan (no subsidy) | $300 to $550 | Yes | Yes |
| Short term plan | $80 to $250 | Usually excluded | Often excluded |
If you qualify for a marketplace subsidy based on your expected income for the year, the marketplace column can drop significantly, sometimes to $0 to $100 a month for a comprehensive plan. Losing your job is a qualifying life event that opens a special enrollment period, giving you 60 days to enroll in a marketplace plan.
Who should lean toward short term between jobs
- You are healthy with no pre-existing conditions and no regular prescriptions.
- You expect to start new employer coverage within one to three months.
- Your income during the gap is too high for a meaningful marketplace subsidy.
- You want protection against a catastrophic accident or sudden illness at the lowest monthly cost.
Who should lean toward COBRA or the marketplace
- You have a chronic condition or a scheduled procedure that needs uninterrupted coverage.
- You take regular prescriptions that would be uncovered on a short term plan.
- Your income during the gap qualifies you for a marketplace subsidy that closes the price gap with short term options.
- You are pregnant or planning to become pregnant, since maternity care is excluded on virtually all short term plans.
Important timing rules to know
You have 60 days from the loss of employer coverage to elect COBRA, and it is retroactive, meaning you can wait to see if you need care before deciding. A marketplace special enrollment period also runs 60 days. Short term plans can typically start within one to a few days of application approval, so they offer the fastest coverage but the narrowest protection. Mixing options, for example using a short term plan for one month while deciding on COBRA, is allowed but may create a pre-existing condition exposure if you roll from short term to short term.
Frequently asked questions
Can I use a short term plan and switch to COBRA later? You can elect COBRA within 60 days of losing employer coverage, and that window does not stop just because you enrolled in a short term plan. However, confirm with your benefits administrator that the election window is still open before assuming you can switch.
Does losing a job count as a special enrollment event for the marketplace? Yes. Involuntary loss of job-based coverage is a qualifying life event that opens a 60-day special enrollment window for ACA marketplace plans.
What if I am unemployed for more than a year? Short term plans typically cannot cover you beyond 364 days (and many states limit them further). If the gap extends that long, a marketplace plan, Medicaid if you qualify, or a COBRA extension if available are more sustainable options.
Bottom line
Between jobs, short term health insurance can cut your monthly cost to a fraction of COBRA, often $80 to $250 versus $500 or more, but it comes with real coverage gaps around pre-existing conditions and prescriptions. Healthy people with a short, defined gap often find it a sensible bridge. Anyone with ongoing medical needs, a pre-existing condition, or marketplace subsidy eligibility should compare all three options carefully. Talk to a licensed broker or insurance navigator to get quotes across all options before you decide.
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