Selecting the best health insurance plan can feel overwhelming. If you aren’t eligible for employer-sponsored health insurance, you can buy a plan through the Affordable Care Act (ACA) marketplace at Healthcare.gov, which lets you compare plans available in your area.
The ACA also allows you to compare multiple health insurance quotes so you can select the health plan that works for you.
How Much Does Health Insurance Cost?
The average monthly cost of health insurance for a silver plan on the ACA marketplace is $397 for individual unsubsidized coverage for a 21-year-old person, $419 for a 27-year-old, $453 for a 30-year-old, $509 for a 40-year-old, $712 for a 50-year-old and $1,079 for a 60-year-old.
Health insurance companies base ACA marketplace plan rates on multiple factors, including:
- Your state and age
- Your smoking status
- The type of health plan
- The metal tier
- How many people you’ll have on the health plan
The health insurance marketplace is different from group health insurance provided by employers. Those plans don’t consider your age when setting rates.
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Compare Health Insurance by Plan Level, Metal Tier, Age, Company
The cost of health insurance on the ACA marketplace varies based on multiple factors. Let’s take a look at average costs using some of those factors.
Average Costs by Health Insurance Plan
The health plan’s benefit design dictates things like whether you can get out-of-network care and whether you need referrals to see specialists. It also influences your costs.
| Average monthly cost for HMO | Average monthly cost for EPO | Average monthly cost for PPO |
|---|---|---|
|
$480
|
$524
|
$576
|
Source: Healthcare.gov. Average costs are for a 40-year-old. Based on unsubsidized ACA plans.
Average Costs by Metal Tier
Premiums and out-of-pocket costs decide an ACA plan’s metal tier. If you’re looking for affordable health insurance going with a bronze plan with lower premiums but higher out-of-pocket costs when you need care might be your best bet.
| Average monthly costs for bronze plan | Average monthly costs for silver plan | Average monthly costs for gold plan |
|---|---|---|
|
$420
|
$549
|
$713
|
Source: Healthcare.gov. Costs are for a 40-year-old. Based on unsubsidized ACA plans. Note: Platinum plans aren’t usually offered and we don’t have enough cost data on those types of plans to offer an accurate picture of costs.
Average Health Insurance Costs by Age
Your age is one of the most important factors that dictate your health insurance costs on the health insurance marketplace. The ACA marketplace is the only place where standard health insurance uses age to set rates. Employer plans, which is how most pre-retirement age Americans get coverage, does not use age as a factor.
| Age of member | Average monthly costs |
|---|---|
|
Age 21
|
$397
|
|
Age 27
|
$419
|
|
Age 30
|
$453
|
|
Age 40
|
$509
|
|
Age 50
|
$712
|
|
Age 60
|
$1,079
|
Source: Healthcare.gov. Based on unsubsidized ACA plans.
Average Health Insurance Costs by Company
Obamacare costs differ by company, so it’s wise to compare costs for multiple plans before choosing an ACA plan.
| Health insurance company | Average monthly cost for a 40-year-old |
|---|---|
|
$445
|
|
|
$459
|
|
|
$466
|
|
|
$504
|
|
|
$506
|
|
|
Blue Cross Blue Shield
|
$569
|
Source: Healthcare.gov. Costs are for a silver plan. Based on unsubsidized ACA plans.
How to Compare Health Insurance Quotes and Plans
Compare health insurance premiums, out-of-pocket costs like deductibles and coinsurance and the plans’ benefit designs and provider network when figuring out which ACA plan to choose.
Premiums, which you pay for health insurance coverage, are one important factor, but don’t forget to review deductibles, coinsurance and copays, too. Those costs are factored in whether an ACA plan is bronze, silver, gold or platinum. The ACA marketplace lets you compare all of those cost factors.
Here are questions you may want answered when you’re requesting a health insurance quote:
- Types of Plans
- Metal Tiers
- HDHP and HSA
- Deductibles and Out-of-Pocket Costs
- Medication Coverage
- Out-of-Network Coverage
- Referrals
Types of Plans
The type of plan you choose dictates the flexibility of your health insurance. Some plans allow you to see almost any doctor, while others restrict your options to only in-network providers. Plans vary in cost as well. There are four basic types of health care plan benefit designs: HMO, PPO, POS and EPO.
Benefit design reflects whether the plan allows out-of-network care, requires members to choose a primary care provider and mandates if members need referrals to see specialists. A plan’s benefit design influences not only how much your health plan flexibility but also how much you pay for out-of-network services.
Benefit Design Comparison
| Plan type | Out-of-network coverage? | Need referral for specialists? | Cost |
|---|---|---|---|
|
No
|
No
|
More expensive than HMOs but less expensive than PPO premiums generally
|
|
|
No
|
Yes
|
Least expensive
|
|
|
Yes
|
Yes
|
More expensive than HMOs but less expensive than PPOs typically
|
|
|
Yes
|
No
|
Most expensive
|
Metal Tiers
Health plans in the ACA exchange are organized into four metal tiers based on costs:
- Bronze and silver plans typically have the lowest premiums.
- Gold and platinum plans have higher premiums.
- However, bronze and silver plans have higher out-of-pocket costs than gold or silver plans when you need care.
You shouldn’t choose a health care plan solely on premiums. Out-of-pocket costs also play a vital role in overall health expenses. Out-of-pocket costs, including health insurance deductibles and coinsurance, are what you pay when you need health care services. Gold and platinum plans have the lowest out-of-pocket costs, so you’ll pay less when you need care with those plans rather than bronze or silver plans.
A marketplace plan’s metal tier only helps you figure out health care costs. It doesn’t take into account the plan’s benefit design.
Metal Tier Comparison
| Type of metal tier | Premiums | Deductibles | Coinsurance levels |
|---|---|---|---|
|
Bronze
|
Cheapest
|
Highest
|
40%
|
|
Silver
|
More expensive than bronze
|
Not as high as bronze
|
30%
|
|
Gold
|
Less expensive than platinum
|
Higher than platinum
|
20%
|
|
Platinum
|
Most expensive
|
Lowest
|
10%
|
HDHP and HSA
One lower-cost option is a high-deductible health plan (HDHP), which has lower monthly premiums but higher out-of-pocket costs. Bronze and silver plans may be considered HDHPs on the ACA marketplace.
The Internal Revenue Service (IRS) defines an HDHP as any plan with:
- A deductible of at least $1,600 for an individual or $3,200 for a family.
- Annual in-network out-of-pocket expenses (such as deductibles and copayments) can’t exceed more than $8,050 for an individual or $16,100 for a family.
Having an HDHP means you’re eligible for a health savings account (HSA). HSAs are accounts that you use to pay for eligible healthcare costs. You put in the money tax-free, take it out tax-free and get the compounded growth tax-fee.
HSA funds rollover into the next year, so they don’t have use-it-or-lose-it restrictions like a flexible spending account. That’s just one of the differences between FSAs and HSAs.
Deductibles and Out-of-Pocket Costs
A health insurance deductible is the amount you pay for health care services annually before your health insurance plan begins to kick in money.
Once you reach your plan’s deductible, you typically reach the coinsurance portion of your health plan. With coinsurance, you and the health plan pay a percentage for healthcare services. If your health plan has a 30% coinsurance level, you pay 30% of the healthcare services bill and the insurer pays the other 70%. You pay coinsurance until you reach your plan’s annual out-of-pocket maximum.
Out-of-pocket costs refer to the patient’s personal costs associated with healthcare. Your plan’s deductible and coinsurance (and copayments for some plans) are factored into your out-of-pocket costs. Premiums aren’t considered out-of-pocket costs.
Medication Coverage
Health insurance helps pay for the cost of certain prescription medications. A formulary is a list of generic and brand name prescription drugs that are covered by a health care plan. Where a drug sits on your plan’s formulary tier influences how much it will pay and how much you pay for the drug.
The number of tiers may differ by health insurance plan. An example of a plan formulary is:
- Tier 1: Inexpensive generic drugs.
- Tier 2: More expensive generic drugs and some brand-name drugs.
- Tier 3: High-cost brand-name drugs that may have a generic or other alternative.
- Tier 4: Expensive, brand-name drugs.
To find out what your plan covers, look for the formulary, which may be on the insurer’s website, in your Summary of Benefits and Coverage notice from the insurance company or in any coverage materials your plan sends to you. You can also reach out to the insurer directly for this information.
Out-of-Network Coverage
Out-of-network coverage possibilities are important to consider. Health insurance companies contract with physicians and medical establishments. These providers are considered your plan’s network.
Some plans, like PPOs, allow you to get care outside of your network at a higher price, while HMOs and EPOs generally don’t allow it.
Check the health plan’s provider network to make sure you have providers in your area that accept the insurance. This is especially crucial if it’s a plan that doesn’t pay for out-of-network care.
Referrals
Depending on your health insurance plan, you may need to get a referral from a primary care provider to see a specialist. HMOs typically require referrals, but PPOs and EPOs generally don’t require referrals to see specialists.
When your plan doesn’t require a referral, you often have more flexibility in scheduling specialist appointments and can worry less about the accompanying costs. But that flexibility often comes with higher premiums.
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