Short Term Medical Costs: What You'll Really Pay (Premiums, Deductibles, and More)

Understanding the real costs of Short Term Medical insurance is crucial for making an informed decision. While premiums may seem affordable, the total cost of ownership includes premiums, deductibles, copays, coinsurance, and potential hidden fees. Many people focus only on monthly premiums and are surprised by the total costs when they need care.

This comprehensive guide breaks down every cost associated with Short Term Medical insurance, so you can budget accurately and make the right choice for your situation.

Working with a licensed insurance agent like myself ensures you understand all costs upfront. I'll help you calculate the total cost of ownership, compare options, and find the best value for your budget—all at no extra cost to you.

Understanding Short Term Medical Cost Structure

Short Term Medical insurance costs include several components:

• Monthly Premiums: The amount you pay each month for coverage
• Deductibles: The amount you pay before coverage begins
• Copays: Fixed amounts for specific services
• Coinsurance: Your percentage share of costs after the deductible
• Out-of-Pocket Maximums: The most you'll pay per policy term
• Fees: Administrative fees, enrollment fees, or other charges

The key is understanding the total cost, not just the premium. A plan with a low premium but high deductible may cost more overall if you need significant medical care.

Monthly Premiums: What to Expect

Premium Ranges

Short Term Medical premiums vary significantly based on several factors:

Individual Coverage:

• Basic plans: $50-$150/month
• Standard plans: $150-$300/month
• Comprehensive plans: $300-$500+/month

Family Coverage:

• Basic plans: $150-$400/month
• Standard plans: $400-$700/month
• Comprehensive plans: $700-$1,200+/month

Factors Affecting Premiums

1. Age

• Younger applicants (under 30): Lower premiums
• Middle-aged (30-50): Moderate premiums
• Older applicants (50+): Higher premiums
• Premiums can increase significantly with age

2. Location

• Urban areas: Often higher premiums
• Rural areas: May have lower premiums
• State regulations affect availability and pricing

3. Coverage Level

• Higher benefit amounts = higher premiums
• Lower deductibles = higher premiums
• More comprehensive coverage = higher premiums

4. Health Status

• Healthier applicants: Better rates
• Health issues: May pay more or be denied
• Some plans have simplified underwriting (fewer health questions)

5. Policy Duration

• Shorter terms (30-90 days): Lower total cost
• Longer terms (6-12 months): May have better monthly rates
• Renewal premiums may increase

Real-World Premium Examples

Example 1: Healthy 25-Year-Old

• Location: Texas
• Coverage: Individual, basic plan
• Premium: $80-$120/month
• Annual cost: $960-$1,440

Example 2: Healthy 40-Year-Old

• Location: California
• Coverage: Individual, standard plan
• Premium: $200-$280/month
• Annual cost: $2,400-$3,360

Example 3: Family of 4 (Parents 35, Children 8 and 10)

• Location: Florida
• Coverage: Family, standard plan
• Premium: $450-$650/month
• Annual cost: $5,400-$7,800

My Expert Tip: Premiums are just the starting point. Always calculate total annual costs including deductibles and out-of-pocket maximums to understand the real cost.

Deductibles: Understanding Your Out-of-Pocket Costs

Deductible Ranges

Short Term Medical plans typically have high deductibles:

Individual Plans:

• Low deductible: $1,000-$2,500
• Standard deductible: $2,500-$5,000
• High deductible: $5,000-$10,000+

Family Plans:

• Low deductible: $2,000-$5,000
• Standard deductible: $5,000-$10,000
• High deductible: $10,000-$20,000+

How Deductibles Work

Before Deductible:

• You pay 100% of medical costs
• Some services may be excluded
• Preventive care typically not covered

After Deductible:

• You pay copays or coinsurance
• Insurance covers remaining costs (up to limits)
• Coverage continues until out-of-pocket maximum

Example Scenario:

• Deductible: $5,000
• Hospital stay costs: $15,000
• You pay: $5,000 (deductible) + coinsurance on remaining $10,000
• If coinsurance is 20%: You pay additional $2,000
• Total out-of-pocket: $7,000

Per-Incident vs. Annual Deductibles

Annual Deductible:

• Resets each policy term
• Applies to all medical expenses
• More common in Short Term Medical

Per-Incident Deductible:

• Applies to each separate medical event
• May have multiple deductibles per year
• Less common but can be costly

My Expert Tip: Always check if your deductible is annual or per-incident. Per-incident deductibles can result in much higher costs if you have multiple medical events.

Copays and Coinsurance

Copays

Some Short Term Medical plans include copays:

Common Copay Amounts:

• Doctor visits: $30-$75
• Specialist visits: $50-$100
• Emergency room: $100-$500
• Prescription drugs: $10-$50 (if covered)

Important: Not all Short Term Medical plans include copays. Many require you to meet the deductible first.

Coinsurance

After meeting your deductible, you typically pay coinsurance:

Common Coinsurance Rates:

• 20% (you pay 20%, insurance pays 80%)
• 30% (you pay 30%, insurance pays 70%)
• Some plans may have different rates for different services

Example:

• Deductible met: $5,000
• Medical procedure: $10,000
• Coinsurance: 20%
• You pay: $2,000 (20% of $10,000)
• Insurance pays: $8,000

Out-of-Pocket Maximums

Understanding Maximums

Out-of-pocket maximums cap your total costs per policy term:

Typical Ranges:

• Individual: $5,000-$15,000 per term
• Family: $10,000-$30,000 per term

What Counts Toward Maximum:

• Deductibles
• Copays
• Coinsurance
• Some fees

What Doesn't Count:

• Premiums
• Services not covered
• Costs above benefit limits
• Out-of-network costs (if applicable)

Why Maximums Matter

Once you reach your out-of-pocket maximum:

• Insurance covers 100% of covered services
• No more copays or coinsurance
• Protection against catastrophic costs

Example:

• Deductible: $5,000
• Out-of-pocket maximum: $10,000
• If you have $20,000 in medical expenses:
• You pay: $10,000 (the maximum)
• Insurance pays: $10,000

Hidden Fees and Additional Costs

Enrollment Fees

Some plans charge:

• Application fees: $25-$100
• Enrollment fees: $0-$50
• Processing fees: Varies

Administrative Fees

May include:

• Monthly administrative fees: $5-$20
• Policy fees: $25-$100 annually
• Service fees: Varies

Renewal Fees

If you renew your policy:

• Renewal fees: $0-$100
• Premium increases: Common

• Re-underwriting: May affect rates

Cancellation Fees

• Early cancellation: Usually no fee (but no refund)
• Mid-term cancellation: May forfeit premiums paid

My Expert Tip: Always ask about all fees upfront. Hidden fees can significantly increase your total costs.

Total Cost of Ownership Examples

Scenario 1: Healthy Individual, No Medical Care Needed

Plan Details:

• Premium: $150/month
• Deductible: $5,000
• Term: 6 months

Costs:

• Premiums: $150 × 6 = $900
• Medical care: $0 (no care needed)
• Total cost: $900

Analysis: If you don't need medical care, you only pay premiums. However, you're protected if an emergency occurs.

Scenario 2: Individual with Minor Medical Needs

Plan Details:

• Premium: $200/month
• Deductible: $3,000
• Coinsurance: 20%
• Out-of-pocket max: $8,000
• Term: 12 months

Medical Costs:

• Doctor visits: $500
• Prescription: $200
• Lab work: $300
• Total: $1,000

Costs:

• Premiums: $200 × 12 = $2,400
• Medical (within deductible): $1,000
• Total cost: $3,400

Analysis: You pay premiums plus medical costs up to your deductible. Since costs were below the deductible, you paid everything out-of-pocket.

Scenario 3: Individual with Significant Medical Event

Plan Details:

• Premium: $250/month
• Deductible: $5,000
• Coinsurance: 20%
• Out-of-pocket max: $10,000
• Term: 12 months

Medical Costs:

• Hospital stay: $25,000
• Surgery: $15,000
• Follow-up care: $5,000
• Total: $45,000

Costs:

• Premiums: $250 × 12 = $3,000
• Deductible: $5,000
• Coinsurance (20% of $40,000): $8,000 (capped at out-of-pocket max)
• Total cost: $10,000 (out-of-pocket maximum reached)

Analysis: Even with significant medical expenses, your total cost is capped at the out-of-pocket maximum. This is why understanding maximums is crucial.

Comparing Short Term Medical Costs to Other Options

Short Term Medical vs. COBRA

Short Term Medical:

• Premiums: $150-$300/month
• Deductible: $2,500-$10,000
• Total annual: $1,800-$3,600 (premiums only, no care)

COBRA:

• Premiums: $500-$800/month
• Deductible: $1,000-$5,000 (typically lower)
• Total annual: $6,000-$9,600 (premiums only, no care)

Savings with Short Term Medical: $4,200-$6,000/year in premiums alone.

However: COBRA has better coverage and lower deductibles, so total costs may be similar if you need significant care.

Short Term Medical vs. ACA Plans

Short Term Medical:

• Premiums: $150-$300/month (no subsidies)
• Deductible: $2,500-$10,000
• Limited coverage

ACA Plans (with subsidies):

• Premiums: $50-$200/month (after subsidies for eligible individuals)
• Deductible: $1,000-$8,000
• Comprehensive coverage

Analysis: If you qualify for ACA subsidies, ACA plans may actually cost less than Short Term Medical, with better coverage.

How to Minimize Short Term Medical Costs

Strategy 1: Choose the Right Deductible

If you're healthy and rarely need care:

• Choose a higher deductible
• Lower monthly premiums
• Save money if you don't need care

If you expect some medical needs:

• Consider a moderate deductible
• Balance premiums and out-of-pocket costs
• Calculate total annual costs

Strategy 2: Match Coverage Duration to Needs

If you need coverage for 3 months:

• Don't buy a 12-month policy
• Pay only for what you need
• Save on unnecessary premiums

If you need longer coverage:

• Consider if ACA enrollment is coming
• Plan for transition to permanent coverage
• Avoid gaps in coverage

Strategy 3: Compare Multiple Plans

Don't choose the first plan you see:

• Compare premiums, deductibles, and maximums
• Calculate total annual costs
• Consider coverage differences

My Expert Tip: I can help you compare multiple plans and calculate total costs for your specific situation.

Strategy 4: Understand What's Covered

Know what's excluded:

• Pre-existing conditions
• Preventive care
• Maternity care
• Mental health (often limited)

Avoid surprise costs:

• Read the policy carefully
• Understand coverage limitations
• Ask questions before enrolling

Common Cost Mistakes to Avoid

Mistake 1: Focusing Only on Premiums

The Problem: Low premiums may mean high deductibles and total costs.

The Solution: Calculate total annual costs including premiums, deductibles, and maximum out-of-pocket.

Mistake 2: Ignoring Out-of-Pocket Maximums

The Problem: Not understanding your maximum exposure.

The Solution: Always check out-of-pocket maximums. This is your worst-case scenario cost.

Mistake 3: Not Accounting for Hidden Fees

The Problem: Surprise fees increase total costs.

The Solution: Ask about all fees upfront. I can help you identify all costs.

Mistake 4: Choosing Wrong Coverage Duration

The Problem: Paying for coverage you don't need.

The Solution: Match coverage duration to your actual needs. Don't over-insure.

Mistake 5: Not Comparing Options

The Problem: Missing better deals or more appropriate coverage.

The Solution: Compare multiple plans. I can help you find the best value.

Frequently Asked Questions

Q: How much does Short Term Medical really cost?

A: Total costs vary widely. Premiums range from $50-$500/month depending on age, location, and coverage. Add deductibles ($1,000-$10,000+) and potential out-of-pocket costs. I can help you calculate total costs for your situation.

Q: Are there hidden fees with Short Term Medical?

A: Some plans have enrollment fees, administrative fees, or renewal fees. Always ask about all fees upfront. I'll help you identify all costs before you enroll.

Q: Can I get a refund if I cancel early?

A: Typically, no. Short Term Medical premiums are usually non-refundable if you cancel mid-term. However, you can usually cancel without penalty.

Q: Do premiums increase if I renew?

A: Often, yes. Premiums may increase upon renewal, especially as you age. Some plans guarantee renewal rates, others don't.

Q: What's the total cost if I need significant medical care?

A: Your total cost is capped at your out-of-pocket maximum (typically $5,000-$15,000 per term). This includes premiums, deductibles, copays, and coinsurance.

Q: Is Short Term Medical cheaper than other options?

A: Premiums are often lower than COBRA or unsubsidized ACA plans. However, high deductibles and limited coverage mean total costs may be similar if you need care. If you qualify for ACA subsidies, ACA plans may cost less.

Why Work With Me to Understand Costs?

Understanding Short Term Medical costs is complex, and missing details can cost you thousands of dollars. Here's how I help:

✅ Complete Cost Analysis

I'll help you calculate total annual costs including premiums, deductibles, maximums, and all fees.

✅ Plan Comparison

I'll compare multiple Short Term Medical plans and show you the real costs of each option.

✅ Fee Identification

I'll identify all fees and hidden costs so there are no surprises.

✅ Total Cost Projections

I'll help you understand worst-case, best-case, and typical cost scenarios.

✅ Option Comparison

I'll compare Short Term Medical costs with COBRA, ACA plans, and other options.

✅ No Extra Cost

My services are free—I'm paid by insurance companies, not you. You get expert guidance at no additional charge.

Conclusion: Understand All Costs Before You Enroll

Short Term Medical insurance costs include much more than just monthly premiums. Understanding deductibles, copays, coinsurance, out-of-pocket maximums, and hidden fees is essential for making an informed decision and budgeting accurately.

Don't focus only on premiums. The total cost of ownership can be significantly higher than premiums alone, especially if you need medical care.

Ready to understand the real costs? Contact me today for a free, no-obligation consultation. I'll:

• Calculate total annual costs for your situation
• Compare multiple Short Term Medical plans
• Identify all fees and hidden costs
• Help you understand worst-case scenarios
• Compare costs with other coverage options
• Recommend the best value for your budget

There's no cost to work with me, and no obligation. Let's make sure you understand all the costs before you enroll. Reach out today—I'm here to help you make an informed financial decision.