What You Need to Know Before Choosing Bronze Health Insurance

Bronze shooting stars.
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If you’re considering signing up for a bronze health plan, make sure you understand what you’re getting yourself into first. Don’t make your decision based purely on the monthly premium cost because you think bronze health insurance is the cheapest. Here’s what you need to know.

Bronze Health Insurance Doesn’t Always Have the Lowest Premiums

When you’re comparing bronze, silver, gold, and platinum health plans, don’t make the mistake of assuming bronze health plans are necessarily the cheapest health insurance.

The metal-tier of the health plan doesn’t describe its price, it describes its actuarial value. It tells you what percentage of health care expenses the plan is likely to pay, on average, for it’s members each year.

  • Bronze plans have an actuarial value of 60%.
  • Silver plans have an actuarial value of 70%.
  • Gold plans have an actuarial value of 80%.
  • Platinum plans have an actuarial value of 90%.

Just because a bronze health plan has a lower actuarial value, doesn’t necessarily mean it comes with a lower price tag. Sometimes the cheapest silver health plans available in your area actually have lower monthly premiums than the most expensive few bronze health plans on your health insurance exchange. If you can get a silver health plan that pays about 70% of your health care expenses for a lower monthly premium than a bronze health plan that pays only 60% of your expenses, the coverage offered by the silver plan is the better deal.

If you’re under 30 years old and legally residing in the United States, or if you have a hardship exemption, you’re eligible to enroll in catastrophic health insurance. Catastrophic health plans can have lower monthly premiums than bronze health insurance and cover the same essential health benefits as bronze plans do.

However, catastrophic plans have extremely high deductibles and may have an actuarial value less than 60%.

Choosing a Bronze Health Plan Will Make You Ineligible for Some Financial Aid

If you have an income between 100% and 250% of federal poverty level, you may be eligible for three types of health insurance financial aid:

However, if you choose bronze health insurance, you won’t be allowed to collect the financial aid from either the cost-sharing subsidy or the subsidy to reduce your out-of-pocket maximum. In order to receive those two subsidies, you must choose a silver health plan. The only subsidy you’ll be able to use with a bronze health plan is the premium tax credit.

How the Cost-Sharing Health Insurance Subsidy Works

How the Premium Tax Credit Subsidy Works

Monthly Premiums Are Not the Only Thing to Worry About

If you choose health insurance based solely on the monthly premiums, you’re not seeing the big picture. Premiums aren’t the only thing you’re paying when you have health insurance. You also pay cost-sharing each time you actually use your health insurance. Make sure you buy a health plan that you can afford to use, not just a health plan you can afford to pay for. I Have Health Insurance. Why Do I Still Have to Pay for Health Care?

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