When buying a private health insurance plan for yourself or your family, there are a lot of comparisons to make. We’re here to help you learn the basics about health insurance plans and costs, so you can find a plan that works best for you.
When comparing plan costs, there’s more to think about than just your premium (what you pay for your plan every month). There are other out-of-pocket costs to consider as well.
Generally, the higher your premium, the lower your out-of-pocket costs. Out-of-pocket costs may include:
- Deductible – This is the amount you pay for covered medical care before your plan starts to pay. Before you meet your deductible, you’re responsible for all costs (unless otherwise noted). After you meet your deductible, your plan starts to help pay for your medical care.
- Copays – These are flat fees you pay each time you get a covered service or procedure.
- Coinsurance –This is a percentage of the total cost you pay for care after you’ve met your deductible. Your plan covers the rest.
- Out-of-pocket maximum – This is the most you’ll pay in a year for covered care. When you reach your out-of-pocket maximum, your insurance takes care of all remaining covered medical costs.
It’s also a good idea to check if you may be eligible for extra savings, like tax credits. You can take advantage of these opportunities to lower your monthly premiums and out-of-pocket costs by shopping for coverage on your state’s health insurance marketplace (also called an exchange).
A health plan network is a group of clinics, hospitals, pharmacies and doctors that a health insurer contracts with so their members can get lower costs. Together, these providers represent a plan’s “network”.
All plans have different networks of providers. Health insurers encourage their members to seek care from in-network providers because it helps ensure members get the best price and most comprehensive coverage under their plan. Many plans limit out-of-network coverage or don’t cover it at all, so out-of-network care is almost always more expensive.
Most plans are offered at three levels: gold, silver and bronze. Choosing the right level for you depends on your budget and how often you expect to use your plan.
With gold plans, your insurance carrier pays around 80% of your costs, and you pay the remaining 20%. Monthly premiums tend to be higher with gold plans. But when you need care, you’ll pay less for it than with other plan levels.
A gold plan might work for you if:
- You have health conditions that need ongoing management, so you think you’ll need richer insurance coverage
- You expect your family to visit the doctor frequently
A CSR is a discount that lowers costs for copayments, coinsurance and deductibles. It’s available only with silver-level plans on the marketplace.
A silver plan might work for you if:
- You’re not sure what your health care needs will be, but you want more than basic coverage
- Your family visits the doctor a few times per year
With a bronze plan, your insurance carrier pays around 60% of your costs, and you pay the remaining 40%. While this level typically has the lowest monthly premiums, you’ll pay more than the other levels when you need care.
A bronze plan might work for you if:
- You want protection against costs for a serious unexpected illness or injury
- You’re looking for a more budget-friendly option because you don’t expect to visit the doctor very often
A health savings account (HSA) is a savings account that allows you to put tax-free money aside for certain health care costs, like deductibles and copays. You can contribute to an HSA when you’re enrolled in a high-deductible health plan (HDHP), which is a type of plan with lower monthly premiums and higher out-of-pocket costs when you need care. All bronze and some silver plans qualify as HDHPs and are eligible to pair with an HSA.
Here’s a summary of the most important takeaways about insurance plan levels. Keep these things in mind as you start to shop different plans:
| Gold | Silver | Bronze | |
|---|---|---|---|
| Your monthly premium | Higher | Moderate | Lower |
| Your costs when you get care | Lower | Moderate | Higher |
| Could work for you if | You think you’ll use your health insurance regularly | You’re not sure how much you’ll use your health insurance, but you want to be prepared | You don’t think you’ll use your health insurance very much |
| HSA options available? | No | Yes | Yes |