Short-Term Medical (STLDI)
Limited-duration health insurance — often non-ACA-compliant — used as a gap-filler between jobs, missed OEP, or when consumers want lower premiums than ACA plans.
Full Definition
Short-Term Limited Duration Insurance (STLDI) is health coverage that is not required to meet ACA Essential Health Benefits or guaranteed-issue rules. It can medically underwrite applicants and exclude pre-existing conditions. Federal rules on STLDI duration have swung: the Trump administration (2018 rule) allowed up to 12 months with renewals; the Biden administration (effective September 1, 2024) limits STLDI to 3-month initial terms and a 4-month maximum with renewals. STLDI is popular as a bridge product between jobs or when consumers miss ACA OEP and do not qualify for SEP. Carriers include UnitedHealthOne, Pivot Health, Everest. STLDI pays high agent commissions (20–25% FYC) but has been criticized for denying claims on undisclosed pre-existing conditions.
Example
A consumer loses employer coverage in March, misses ACA SEP deadlines, and buys 3-month STLDI to bridge to a new employer's coverage starting July 1. Premium $220/month; agent commission 22% = $145 total.
Related Terms
- ACA (Affordable Care Act) / Marketplace — U.S. federal law (2010) that created the individual health insurance marketplace, premium subsidies, and the open enrollment framework for under-65 major medical.
- Under-65 Health Insurance — Health insurance for consumers not yet Medicare-eligible — primarily ACA marketplace plans, short-term medical, and indemnity products.
- SEP (Special Enrollment Period) — A year-round enrollment window triggered by qualifying life events — loss of coverage, move, marriage, income change — that allows enrollment outside OEP.