[UPDATED] How to Choose Between Marketplace Plans for Health Insurance

September 07, 2015 : Teresa Shipley Feldhausen

Editor’s Note: It’s never too early to start planning ahead, especially when it comes to getting healthcare coverage. Here’s a quick breakdown of the Marketplace plans — with updated information for 2017 enrollment — so you can make the best decision. 

If you don’t have healthcare through a job or a government plan like Medicare or Medicaid, or the Children’s Health Insurance Program (CHIP), you can apply for a plan through a state or federal Marketplace. Doing so is easy: you can apply by phone, through the mail, or online.

What’s the Difference Between Marketplace Plans?

Marketplace plans are defined by five categories: bronze, silver, gold, platinum and catastrophic. The different levels have nothing to do with quality; rather they describe how much you generally pay toward covered expenses and the premiums for the various levels of coverage. The actual percentage you’ll pay will depend on the services you use during the year and other factors.

  • Bronze: The plan pays about 60% of your medical bills; you pay about 40%.
  • Silver: The plan pays about 70% of your medical bills; you pay about 30%. Cost-sharing reductions may be available when you choose a silver plan. Your household size and income will determine whether you are eligible. These cost-sharing reductions mean you get savings on out-of-pocket costs as well as paying lower deductibles, coinsurance and copayments.
  • Gold: The plan pays about 80% of your medical bills; you pay about 20%.
  • Platinum: The plan pays about 90% of your medical bills; you pay about 10%.
  • Catastrophic plans, which pay less than 60% of the total average cost of healthcare, are only available to people younger than 30 years old or those who have a hardship exemption. These plans also don’t generally cover any benefits other than three primary care visits per year until the plan’s deductible is met. The out-of-pocket costs on the catastrophic plan for deductibles, copayments and coinsurance are generally higher.

What’s Covered Under the Plans?

All of the healthcare plans – even catastrophic – cover these 10 essential benefits:

  • Ambulatory patient services (outpatient care you get without being admitted to a hospital)
  • Emergency services
  • Hospitalization (such as surgery)
  • Pregnancy, maternity, and newborn care (before and after your baby is born)
  • Mental health and substance use disorder services, including behavioral health treatment (this includes counseling and psychotherapy)
  • Prescription drugs
  • Rehabilitative and habilitative services and devices (services and devices to help people with injuries, disabilities, or chronic conditions gain or recover mental and physical skills)
  • Laboratory services
  • Preventive and wellness services and chronic disease management
  • Pediatric services, including oral and vision care, for children under 18

All Marketplace plans also cover treatment for pre-existing conditions. And all plans must cover some screenings, immunizations and other preventive services before you’ve met your deductible.

What if I Need Coverage for Something Not on the List?

The “essentials” list is just the minimum coverage you’ll receive with any of the plans in the Marketplace. Many plans offer additional coverage for areas like dental, vision or specific disease management. You can compare many plans side by side at Healthcare.gov by simply entering your zip code and seeing what plans are offered in your area.

How Do I Know What Level of Plan to Choose?

Although it’s impossible to know what all of your health needs will be in the coming year, by asking yourself some simple questions you can figure out your ideal plan. Do you expect to visit the doctor frequently, or do you need frequent prescriptions? If so, you may want a gold or platinum plan. These plans generally have higher monthly premiums, but pay more of your costs when you need care. On the flip side, if your health is good and you don’t anticipate needing to see a doctor often, you might prefer a bronze, silver or catastrophic plan. Those will cost you less per month, but your deductibles and out-of-pocket costs will be higher.

The maximum out-of-pocket cost limit for any individual Marketplace plan for 2017 is no more than $6,550 for an individual plan and $13,100 for a family plan. This means once the amount you’ve paid in deductibles, copayments and coinsurance reaches these limits, insurance will pay 100% of your costs for covered care for the rest of your coverage period.

Still have questions about whether you are required to have health insurance, or how it might affect your tax return? We have helpful resources online, or you can make an appointment with a tax prep professional at an H&R Block office year-round.

 

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Teresa Shipley Feldhausen

Guest Contributor

Teresa is a health and science reporter living in Washington, D.C. She has been a researcher for National Geographic Magazine, a writer and blogger for the Student Conservation Association and a reporter for Idaho newspapers.