When the Affordable Care Act’s (ACA) state-based and federally facilitated health insurance marketplaces opened on Oct. 1, 2013, we were introduced to a new way of selecting health insurance: by actuarial tier, more commonly referred to as “metal level.”
Several years into the ACA, if you’re still confused about the difference between a bronze plan and a platinum plan, we’ve got the information you need so that you can pick the best health insurance plan for you.
After we cover the metal levels in detail, including what they are, how they’re different and how to know which one may be best for you, we’ll outline some supplemental and non-ACA health insurance options that may fit your needs. Or, you can jump right to that section.
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Why Metal Levels?
The metal level tiers were primarily established to:1
- Set a minimum amount of coverage people must have to satisfy the ACA’s individual mandate.
- Establish standardized levels of major medical insurance available through HealthCare.gov, the state-based exchanges and the private market.
- Set a benchmark for premium tax credits and cost-sharing reduction subsidies.
What Are the ACA Metal Levels?
All individual major medical health insurance plans on the market today are categorized into four tiers based on how covered medical costs are shared between the health insurance policy and you, the policyholder. It has nothing to do with the level of care or covered services included in the plan.2
Under the ACA, these tiers have been assigned a metal name: bronze, silver, gold or platinum.
Metal Levels Overview3
|% of Covered Medical Costs Paid By Policy||60%||70%||80%||90%|
|% of Covered Medical Costs Paid By Consumer||40%||30%||20%||10%|
|Monthly Premium Comparative Cost||Lowest||Moderate||High||Highest|
|Unsubsidized Annual Deductible Comparative Cost||Highest||Moderate||Low||Lowest|
|Eligible to apply a cost sharing reduction?4||No||Yes||No||No|
|Eligible to apply a premium tax credit?5||Yes||Yes||Yes||Yes|
Which ACA Plan is Right For You?
You may want to choose a bronze plan if you tend to use very few healthcare services and primarily want a health plan for serious, unexpected illnesses or injuries. You will pay for more of your routine care out of pocket, and will generally have higher out-of-pocket costs when you need medical care. However, you’ll have a lower monthly premium.6
You may want to choose a silver plan if you wish to use your health insurance for minimal preventive care during the year but don’t require regular visits to the doctor, such as to manage a chronic health condition. If you qualify for a cost-sharing reduction you will want to select a silver plan from the ACA federal marketplace or your state exchange to receive that subsidy.7
Find out if you could qualify for a subsidy for ACA-qualifying health coverage.
You may want to choose a gold plan if you make frequent trips to the doctor, have chronic health conditions that require ongoing medical attention, and want to keep your deductible lower so you can access your benefits earlier in the year. Remember, you’ll be paying a higher premium each month.8
You may want to choose a platinum plan if you expect your medical expenses to be substantial and want the lowest deductible possible in order to access your plan benefits as early in the year as possible. Typically, you will pay the most in monthly premium with a platinum health insurance policy, however, nearly all other costs will be covered.9
Do ACA Plan Benefits Differ by Metal Level?
Generally, no. The ACA requires that all major medical insurance plans include the same minimal coverage for healthcare items and services included in the essential health benefits:
- Ambulatory patient services
- Emergency services
- Pregnancy, maternity, and newborn care
- Mental health and substance use disorder services
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Lab services
- Preventive and wellness services, chronic disease management
- Pediatric services10
Carriers may choose to offer more than the minimum essential health benefits, and they may have to provide more coverage within the broader health service categories based on state requirements. That is where plans could vary.11
ACA-qualifying major medical plans don’t cover everything. For example, they typically do not cover infertility treatment, elective cosmetic surgery, weight loss surgery, dental and vision care for adults, long-term care, chiropractic and acupuncture, and abortion care and male contraception like a vasectomy.12 13
Cost, including plan premium and deductible, is the biggest difference between metal levels. That is why it is important to shop with cost-sharing in mind. Determine what share of covered medical expenses you and your family can afford if you need healthcare and not just select the plan with the lowest monthly premium.
- Get more information about how to choose the right ACA health plan
- Find out if you can get an ACA health plan now
- Find your public ACA exchange to enroll
Now that we’ve covered the ACA metal levels, we’re going to overview some supplemental insurance options that may be beneficial to you depending on the type of ACA plan you’ve selected, and a non-ACA health insurance option if you decide you don’t want to enroll in a major medical plan.
Do You Have Enough Coverage if You’re Diagnosed With a Critical Illness?
Most of us assume that if we enroll in a comprehensive major medical policy we’ll have the coverage and financial protection we need. Unfortunately, major medical coverage does not guarantee that you won’t face financial difficulty as a result of medical bills.
According to Kaiser Family Fund (KFF), more and more Americans with major medical insurance find themselves underinsured and experiencing problems paying medical bills:
- 20% of insured adults between 18 and 64 had trouble paying medical bills.
- 26% of insured adults with high deductible health plans had trouble paying medical bills.
- 66% of those having trouble paying medical bills say the bill was the result of a one-time or short-term medical expense such as a hospital stay or accident.
- Heart disease, heart attacks, stroke, cancer, and gastrointestinal/stomach conditions were the most common health conditions that led to medical bills.14
Even if you have major medical insurance you’ll still be responsible for out-of-pocket costs if you are diagnosed with a critical illness like cancer. For example, you pay:
- Your annual deductible amount – in 2018, the average individual annual deductible for an employer health plan was $1,21715
- Coinsurance and copays until you’ve reached the annual out-of-pocket maximum – The 2019 out-of-pocket maximum for individuals with an ACA plan is $7,900 and $15,800 for families16
- The extra cost of medical care you receive out-of-network if you need it
- Rehabilitative and home healthcare services that may not be covered by your major medical policy
- For any alternative or supplemental treatments you receive that are not covered by your policy (e.g., acupuncture, chiropractic, herbal supplements)
In addition to the added medical bills, regular household bills don’t stop just because you’re sick. In fact, you may have to take time away from work to recover and may find yourself with reduced income. Major medical insurance does not pay for groceries, childcare or gas.
How does critical illness insurance work?
That’s where critical illness insurance may be able to help. Critical illness coverage either pays a lump sum (fixed) cash benefit upon diagnosis of a covered illness, or a benefit amount based on treatment received (indemnity coverage) depending on the plan design.17
Who should consider critical illness insurance?
Critical illness plan premiums are typically affordable because coverage is limited to specific illnesses. You may want to consider a critical illness policy if you:
- Have a high deductible major medical plan
- Have very little in savings or income to pay your out-of-pocket costs
- Are at an increased risk for developing a critical illness like cancer, heart disease or stroke due to lifestyle (i.e., tobacco use) or family history
- Are between 18 and 65 years old – the younger you are when you enroll the lower your premium.18
How do you qualify?
While you do have to qualify for these plans (they may not be guaranteed issue), many with lump sum amounts under $70,000 are considered “simplified issue.” That means you’re not subject to a full underwriting process, you just have to answer a few questions to qualify.19
Plans with larger benefit amounts (over $70,000) will likely require underwriting. And some group plans offered by employers are guaranteed issue.20
Get a quick quote to compare supplemental critical illness plans and costs.
Help Using Your High-Deductible Health Plan
While a low monthly premium can be appealing, it is often paired with a higher plan deductible.
For instance, you could qualify for a premium tax credit that brings your monthly bronze plan premium down to little or nothing.21 However, that bronze plan will include a deductible that must be met before your health insurance policy benefits take effect, and you will pay out of pocket toward that amount.
In 2019, bronze plan annual deductibles averaged $6,258.22
Instead, they pay lump-sum benefits for covered accidents or critical illnesses in addition to whatever benefits your major medical plan provides. Again, you can use these benefits however you choose, whether to pay down your major medical deductible or to help with other costs.
The best way to find out how much these plans could cost you, and if you qualify, is to get a quick quote (it just takes a couple of minutes to get multiple plan options to compare).
Want additional benefits to help with a high deductible health plan?
Concerned about the costs of hospitalization for an accident or illness?
Short Term Health Insurance – A Non-ACA Health Insurance Option
Short term health insurance is one non-ACA option that could provide you coverage for unexpected illnesses or injuries for 30 to 364 days depending on your state (or possibly up to 36 months depending on the policy renewal rules in your state).23
Some benefits of short term medical plans include:
- Monthly premiums are 31.5% less than unsubsidized major medical insurance premiums on average, $124 per month compared to $393 (2016).24
- There’s no open enrollment period so you can apply year-round.
- Plans are highly customizable so you don’t have to pay for coverage you don’t need.
- No provider network limitations means you can visit your preferred healthcare provider.
Some drawbacks of short term medical plans include:
- They are not guaranteed-issue, you must be approved by the carrier in order to enroll.
- They are not considered minimum essential coverage and have less coverage than major medical plans.
- Pre-existing conditions are not covered.
What STM Plans May Cover
Temporary health plans are meant to be an affordable way to maintain some level of insurance coverage while you’re in between major medical plans, for example, if you’re unemployed or in an employer waiting period for employee benefits.
Plans typically provide benefits for hospital room and board; emergency room, anesthesiology, and surgical care; diagnostic services (x-rays, lab tests, and analysis); ambulance and surgical services; and doctor office visits.
However, if you don’t qualify for subsidies and ACA premiums are too expensive, or you prefer to carry a pared-back health plan and pay for more of your healthcare services and medications yourself, a short term medical policy may be an option for you now that the Federal individual mandate tax penalty has been repealed (note that some states have implemented their own state individual mandates and penalties).
Remember, these plans are not comparable to ACA plans and have much more limited coverage (it’s one reason why premiums are so low). So it’s important to understand what is covered and what is excluded in any short term medical plans you’re considering.
The best way to find short term medical plans available in your area and to compare your costs is to request a quote. It just takes a minute.
Summary + Next Steps
Do you need coverage right away? Find out what your enrollment options are today.
Consider supplementing a major medical policy with higher out-of-pocket costs with:
Or, if a major medical plan isn’t available to you for one reason or another, consider a short term health insurance policy.
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