Health Plan Categories

Health plan categories refer to the four types of health insurance plans that are differentiated based on the average percentage of health-care expenses that will be paid by the plan. Under the Patient Protection and Affordable Care Act (ACA), the U.S. health reform enacted March 23, 2010, health insurance plans are offered in four actuarial levels: Bronze, Silver, Gold and Platinum. The level defines the amount of expenses each type of plan covers.

The higher the actuarial value (i.e. Gold and Platinum), the more that health plan category will pay, on average, toward health-care expenses. The lower the actuarial value (Bronze and Silver), the less that health plan category will pay.

On average, the actuarial values for the four coverage tiers are:

• Bronze = 60 percent
• Silver = 70 percent
• Gold = 80 percent
• Platinum = 90 percent

All plans cover the same set of Essential Health Benefits. Because each plan is different in terms of deductible, copayments and coinsurance amounts, your share of the costs may come in the form of a large deductible with low coinsurance (for example, a $4,000 deductible with 10 percent coinsurance) or a small deductible with high coinsurance (such as a $1,500 deductible with 30 percent coinsurance). With all health plans, consumers pay a monthly fee known as a premium whether or not they use health-care services. Premiums are typically higher for plans that pay more of your medical expenses when you get care, such as Gold and Platinum plans. In general, premiums are also higher for plans that have lower deductibles and lower coinsurance amounts.

In addition to the four “metallic” coverage tiers, a catastrophic level is available to people under age 30 and to certain people over age 30 who are granted hardship exemptions based on income and other circumstances that would prevent them from getting a Bronze, Silver, Gold or Platinum plan. There are 12 reasons for which someone may be granted a hardship exemption, including being homeless, having substantial property damage resulting from fire, flood or other disaster, and filing for bankruptcy in the last six months.

• Lowest monthly premium
• Highest costs when you need care
• Bronze plan deductibles can be thousands of dollars a year.
• Good choice if: You want a low-cost way to protect yourself from worst-case medical scenarios, like serious sickness or injury. Your monthly premium will be low, but you’ll have to pay for most routine care yourself.

• Moderate monthly premium
• Moderate costs when you need care
• Silver deductibles are usually lower than those of Bronze plans.
• Good choice if: You qualify for “extra savings” — or, if not, if you’re willing to pay a slightly higher monthly premium than Bronze to have more of your routine care covered.

• High monthly premium
• Low costs when you need care
• Deductibles are usually low.
• Good choice if: You’re willing to pay more each month to have more costs covered when you get medical treatment. If you use a lot of care, a Gold plan could be a good value.

• Highest monthly premium
• Lowest costs when you get care
• Deductibles are very low, meaning your plan starts paying its share earlier than for other categories of plans.
• Good choice if: You usually use a lot of care and are willing to pay a high monthly premium, knowing nearly all other costs will be covered.