Short-term medical insurance in Colorado explained

Short-term medical insurance is temporary coverage meant to bridge a gap, such as the months between jobs. It is not ACA coverage: it can exclude conditions you were treated for before it started, and it does not carry the ACA out-of-pocket cap. Colorado defines these policies in statute: a short-term policy must be nonrenewable, cannot run longer than six months, and cannot be issued to someone who has had more than one short-term policy in the past twelve months (C.R.S. 10-16-102(60), Colorado Revised Statutes 2024, leg.colorado.gov/sites/default/files/images/olls/crs2024-title-10.pdf). For most Coloradans with a gap, a Connect for Health Colorado plan through a special enrollment period, COBRA, or Health First Colorado is the safer bridge. This guide sets out what the law says, what has and has not been verified, and how the numbers compare.

What a short-term policy is

A short-term limited duration policy is individual health coverage sold for a set, short period. Federal law excludes it from the definition of individual health insurance coverage, which is why it does not have to follow the ACA rules on pre-existing conditions, essential health benefits or the yearly out-of-pocket limit (Federal Register, 89 FR 23338, April 3, 2024, federalregister.gov/documents/2024/04/03/2024-06551/short-term-limited-duration-insurance-and-independent-noncoordinated-excepted-benefits-coverage).

People usually look at short-term plans for one of three reasons: they missed open enrollment, they want a lower monthly price than a marketplace plan, or they need a few months of coverage before a new job plan starts. The first and third situations often have better answers, covered below. The second is where the risk sits: a lower price usually means the policy pays for less.

What Colorado law says, verified

The Colorado definition is in the insurance statutes. This guide was checked against the official 2024 printout of Title 10 published by the Colorado General Assembly (leg.colorado.gov/sites/default/files/images/olls/crs2024-title-10.pdf). Under C.R.S. 10-16-102(60), a short-term limited duration health insurance policy is a nonrenewable individual health benefit plan with a specified duration of not more than six months, and it must meet two further requirements.

• Duration: not more than six months, set when the policy is issued.
• Renewal: the policy must be nonrenewable. When it ends, it ends.
• Stacking limit: it can be issued only to people who have not had more than one short-term policy with the same or similar nonrenewable coverage, from any insurer, in the past twelve months. The application must ask the question, and a "yes" means the policy cannot be issued; the statute tells the applicant to wait six months from the date of the last such policy.
• Pre-existing conditions: every marketing piece, application and policy form must say, in bold ten-point or larger type, that any injury, sickness or pregnancy for which you incurred charges, received treatment, consulted a health care professional or took prescription drugs within twelve months before the effective date will not be covered.
• No portability: the same required disclosure says the policy does not provide portability of prior coverage.

How the federal rules fit on top

A federal rule published April 3, 2024 limits short-term plans sold or issued on or after September 1, 2024 to an initial term of no more than three months and no more than four months in total, counting renewals. A new policy from the same insurer to the same person within twelve months of the first policy start date counts as a renewal (89 FR 23338, federalregister.gov/documents/2024/04/03/2024-06551/short-term-limited-duration-insurance-and-independent-noncoordinated-excepted-benefits-coverage).

On August 7, 2025, the Departments of Labor, Health and Human Services and the Treasury said they do not intend to prioritize enforcement of that 2024 definition, including its notice provision, until new rulemaking, and HHS said a state that applies its own state law definition will not be treated as failing to enforce (U.S. Department of Labor statement, 2025, dol.gov/agencies/ebsa/laws-and-regulations/laws/affordable-care-act/for-employers-and-advisers/short-term-limited-duration-insurance/stldi-statement-08-07-2025).

Colorado law did not change because of either federal action. The state definition above (six months, no renewal, the twelve-month stacking limit and the twelve-month pre-existing exclusion) is the floor any policy sold here must meet. Where the federal and state rules differ, a policy has to satisfy the stricter one that applies to it.

The Division of Insurance handled the 2024 federal rule in two bulletins. Bulletin B-4.143 (effective December 12, 2024; Division notice of adoption posted December 17, 2024) covers fixed indemnity coverage and references Colorado Insurance Regulation 4-2-40, and it states that a companion bulletin, B-4.142, issued September 4, 2024, addresses the short-term portion of the rule (Colorado Division of Insurance, Bulletin B-4.143, doi.colorado.gov/sites/doi/files/documents/Bulletin%20B-4.143%20Federal%20Rule%20FR23338%20for%20Independent%2C%20Non-coordinated%20Excepted%20Benefits-%20for%20adoption-%20clean.pdf). The text of B-4.142 itself was not reviewed for this guide.

What is and is not verified here

The three statutory rules are the ones that matter most to a shopper, and they are settled law. The regulation details sit underneath them and can change through rulemaking, so Lisa checks the current Division rule before discussing any specific policy rather than repeating older summaries found online.

Short-term medical compared with the alternatives

A worked example: a five-month gap

Hypothetical Colorado household, not a real client. A single 45-year-old in Thornton leaves a job at the end of July 2026 and starts a new job with health coverage on January 1, 2027, so the gap is August through December 2026, five months. Household income for 2026 is $45,000. They take a daily prescription for a condition diagnosed two years ago.

Step one, the marketplace math. Losing job coverage opens a 60-day special enrollment period (HealthCare.gov, healthcare.gov/coverage-outside-open-enrollment/special-enrollment-period/). For 2026 coverage the poverty guideline for one person is $15,650 (HHS 2025 poverty guidelines, govinfo.gov/content/pkg/FR-2025-01-17/pdf/2025-01377.pdf), so $45,000 is about 287.5% of the poverty level. The 2026 applicable percentage rises from 8.44% to 9.96% across 250% to 300% of the poverty level (IRS Rev. Proc. 2025-25, irs.gov/pub/irs-drop/rp-25-25.pdf); at 287.5% it works out to about 9.58%. That means the household is expected to pay about $4,312 a year, or about $359 a month, toward the benchmark Silver plan, and the premium tax credit covers the rest of the benchmark price.

Step two, the worst case on each side. On the marketplace plan, five months of the expected contribution is about $1,797, and in-network covered costs for 2026 cannot exceed $10,600. The ceiling on what a bad year could cost is therefore about $12,397, and the daily prescription is covered under the plan formulary from the start.

On a Colorado short-term policy, if one were offered, the statutory disclosure means the condition treated in the last twelve months and its prescription would not be covered at all. There is also no ACA out-of-pocket cap, so a large claim for a new illness depends entirely on the policy limits. The monthly premium might look lower, but the exposure has no fixed ceiling.

Why the twelve-month look-back matters so much

Most people who shop for coverage between jobs are not starting from zero. They have a prescription they refill, a specialist they see once a year or a test result they are watching. The Colorado disclosure covers any condition for which you incurred charges, received treatment, consulted a health care professional or took prescription drugs in the twelve months before the policy starts. That is a wide net: a single office visit or a refill in that window can put the condition outside the policy.

Pregnancy is named in the statute too. Someone who is pregnant when a short-term policy starts, or who saw a provider about a pregnancy in the year before, should expect that care to be excluded. A marketplace plan, Health First Colorado or CHP+ covers pregnancy, and CHP+ includes pregnant people with household income under 260% of the poverty level.

Better ways to cover a gap

• Special enrollment on Connect for Health Colorado. Losing job coverage, moving to Colorado, marriage, a birth or adoption generally give you 60 days to enroll in an ACA plan, often with a premium tax credit. Colorado runs its own marketplace, so you enroll through Connect for Health Colorado rather than HealthCare.gov.
• COBRA. You may keep your former employer plan and doctors for a limited period, usually at the full premium. HealthCare.gov suggests comparing the COBRA price with marketplace plans before you decide, and you can still enroll in a marketplace plan within 60 days of losing job coverage (healthcare.gov/unemployed/cobra-coverage/).
• Health First Colorado or CHP+. If your income drops, you or your children may qualify, and you can apply at any time of year.
• A new employer plan. Ask about the waiting period; the bridge you need may be shorter than you think.

Short-term medical is not the same as fixed indemnity

Some products sold as low-cost health plans are fixed indemnity policies, which pay a set dollar amount per day or per service rather than paying medical bills. Under Bulletin B-4.143 (effective December 12, 2024; Division notice of adoption posted December 17, 2024), which references Colorado Insurance Regulation 4-2-40, these policies must show a Colorado notice on the first page of marketing, application and enrollment materials, in at least 14-point type, that begins "IMPORTANT: This is a fixed indemnity policy, NOT health coverage" and points readers to Connect for Health Colorado for comprehensive coverage.

If you see that notice, the product is a supplement to real health insurance, not a replacement for it. Our hospital indemnity guide explains when that kind of policy is useful. The Division notice of adoption is at doi.colorado.gov/announcements/notice-of-adoption-repeal-of-regulation-5-1-19-and-new-bulletins-b-4143-concerning.

Red flags the Division of Insurance warns about

The Division has cautioned Coloradans about short-term plans, trade association plans, health care sharing ministries and other limited plans that can limit coverage for pre-existing conditions, hospital stays, emergency rooms, mental health care and outpatient surgery (Colorado Division of Insurance consumer advisory, 2021, doi.colorado.gov/news-releases-consumer-advisories/consumer-advisory-division-of-insurance-cautions-coloradans-about). It lists warning signs worth knowing:

• Being told the coverage is "just as good as the ACA."
• Words such as "limited benefit plan" or "supplement plan" used to describe what is presented as health insurance.
• Repeated calls, texts, emails or unannounced visits pressing you to close the sale.
• Requests for bank details or a Social Security number before you have seen the plan in writing.

What Lisa checks for you

• Which window you are in today: open enrollment, a 60-day special enrollment period, or neither, and the exact last day to act.
• Your 2026 or 2027 household income estimate against the poverty guideline, so you know whether a premium tax credit or Health First Colorado applies.
• Whether COBRA, a marketplace plan or a new employer plan covers the gap at the lowest total cost, counting premiums and the out-of-pocket cap, not just the monthly price.
• Whether any short-term policy is actually approved for sale in Colorado on the day you ask, using the Division of Insurance filings search (doi.colorado.gov/for-consumers/consumer-resources/insurance-plan-filings-approved-plans), and whether you would pass the statutory twelve-month questions.
• Whether a policy you have been offered is short-term medical, fixed indemnity or something else, by reading the first page and the required notices.
• That the company and the person selling it are licensed with the Colorado Division of Insurance.

Questions to ask before you buy any temporary plan

• Is this an ACA-compliant plan? If not, is it a short-term policy, a fixed indemnity policy or something else?
• How long is the term, and can it be renewed or replaced? (Under Colorado law a short-term policy is capped at six months and cannot be renewed.)
• How does the policy define a pre-existing condition, and what have I been treated for in the last twelve months?
• Is there a maximum the plan will pay, per condition, per service or in total?
• Does it cover prescriptions, mental health care, maternity and emergency care?
• When it ends, will I be able to get an ACA plan right away, or will I have to wait for open enrollment?
• What is the agent license number and the insurer name, so I can check them with the Division?

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The bottom line

Colorado law keeps short-term medical policies short: six months at most, no renewal, no more than one prior policy in twelve months, and a twelve-month pre-existing condition exclusion. For most gaps, a special enrollment period on Connect for Health Colorado, COBRA or Health First Colorado gives real protection with a known ceiling. If you are between plans now, call Lisa at (303) 887-8584 and she will tell you which window you are in and what you can buy today.