HOW DO MEDICAL PLANS WORK IN THE USA?
Do you want to know how medical plans work in the USA? Did you know that medical plans are conditioned by metal levels? In this complete guide we will talk to you in detail about health care plans; you will also learn to differentiate between each type and choose the one that best suits your needs … Would you like to know more information? Keep reading and don’t miss anything.
Basic Terms of Medical Plans
Next, we will leave you with some basic terms that are used in the medical plan market and their respective meaning:
Deductible : Refers to how much money you have to spend for covered health services before your insurance company pays anything (except for free preventive services).
Copays and Coinsurance : Payments you make each time you receive a medical service after you meet your deductible.
Out-of- Pocket Maximum – This is the maximum amount of money you have to spend on covered services in a year. Once you reach this amount, the insurance company pays 100% for covered services.
Medical Plans in the USA: Importance of the Metal Level
The medical plans in the famous «Marketplace» are presented in 4 “metal” categories : Bronze, Silver, Gold and Platinum. Now, there is also a less favourable category called “Catastrophe plans” and they are usually available to some people.
For their part, the metal categories are based on how you and the plan split the costs of the health care you request. In other words, this point has nothing to do with the quality of care. Next, we leave you a comparative table on the metal levels and their percentage of coverage:
Plan Category The insurance company pays: Your expenses represent:
Bronze 60% 40%
Silver 70% 30%
Gold 80% 20%
Platinum 90% 10%
Which Category or Metal Level is the Best for you?
Plan Category Special features
Bronze
Lower monthly premium.
Higher costs when you need medical attention.
Bronze plan deductibles can be thousands of dollars a year.
You want an affordable way to protect yourself from medical worst-case scenarios, like serious illness or injury. Your monthly premium will be low, but you will have to pay for most routine medical care.
Silver
Moderate monthly premium.
Moderate costs when you need medical attention.
Silver deductibles are generally lower than bronze plans.
If you qualify for cost-sharing reductions, you must choose a “Silver” or “Silver” plan for additional savings.
You qualify for “extra savings” or, if you’re willing to pay a slightly higher monthly premium than a “Bronze” plan, to have more of your routine health care covered.
Gold
High Monthly Premium.
Low costs when you need medical attention.
Deductibles are generally lower.
You have the possibility to pay more each month so that more costs are covered when you receive medical treatment. Also, if you are a person who saves and watches your expenses, a Gold plan can be a good option.
Platinum
Higher monthly premium.
Even lower healthcare costs.
Very low deductibles, which means your plan starts paying its share much sooner; at least compared to other levels of metal.
You usually use your health insurance frequently and can pay a high monthly premium, knowing that almost all other costs will be covered.
WHAT ARE CATASTROPHIC HEALTH PLANS
Health insurance plans considered “catastrophic” are those that have low monthly premiums and very high deductibles. In fact, they can be an affordable way to protect yourself from worst-case scenarios like: Sudden illnesses, serious injuries, accidents, etc. Although, you should keep in mind that you are the one who will pay most of the routine medical expenses.
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Who Can Buy a Catastrophic Plan?
Below, we describe who are the people eligible for this type of plan:
People under 30 years old.
Anyone with a hardship waiver or an affordability waiver (depending on the Marketplace or work-based insurance that is not affordable).
Finally, if you’re eligible to purchase a catastrophic plan , you’ll see them when you log in and compare plans on the Health Marketplace.
How Much Do Catastrophic Plans Cost?
Monthly premiums are typically low, but you can’t use a premium tax credit to lower your cost (even more). So if you qualify for a tax credit, a Bronze or Silver plan is likely to offer better benefits. Therefore, it is all about you taking the time to compare between options.
Now, keep in mind that the deductibles you must pay for this type of plan are really high. For example: For 2019, the deductible for all catastrophic plans was $7,900; and for 2020, the deductible for all catastrophic plans was more than $8,150.
What Do Catastrophic Plans Cover?
Catastrophic plans cover the same essential health benefits as other Marketplace plans. Therefore, these types of plans also cover preventive services at no cost and 3 primary care visits per year; all this before you meet your deductible.
Types of Health Plans and Networks
The types of medical plans can vary considerably depending on where you live . In fact, in your area you can find plans in every metal level: Bronze, Silver, Gold and Platinum. Next, we show you the types of plans that you will find in the Market:
Health Maintenance Organization (HMO) Plans : A type of health insurance plan that generally limits coverage to care from professionals who work for or have contracts with the HMO. Generally, it will not cover out-of-network care, except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage.
Exclusive Provider Organization (EPO) : In this case, this is a managed care plan in which services are covered only if you use doctors, specialists, or hospitals in the plan’s network (except in an emergency).
Point of Service (POS) : This is a plan where you pay less if you use doctors, hospitals, and other health care providers that are in the plan’s network. On the other hand, POS plans require you to get a referral from your primary care doctor in order to see a specialist.
Preferred Provider Organization (PPO) : Finally, PPO plans are those where you pay less if you use providers in the plan’s network. In fact, you can use out-of-network doctors, hospitals and providers without a referral for a lower additional cost.
Compare Types of Health Plans
Plan Type Available Doctors Important features Paperwork Involved
HMO Any health professional who belongs to the network.
Less freedom to choose your health care providers
Less paperwork compared to other plans.
Primary care physician available to manage your care and refer you to specialists.
Requires referral before you can see a specialist.
There are no claim forms to complete.
PPO Anyone in the PPO network; you can see doctors outside the network, but you will pay more out of pocket.
Moderate amount of freedom to choose your health care providers, more so than in HMO plans.
Referrals are not required before seeing a specialist.
Higher out-of-pocket costs if you see doctors outside the network.
Little to no paperwork with a PPO if you see a network doctor. Now, if you look for a provider outside the network, you will have to pay them directly. Then, you must file a claim for the PPO plan to pay you back.
EPO Anyone in the EPO network. Although, there is no coverage for out-of-network providers.
You can choose some of your health care providers; at least more than an HMO.
Referrals are not required to see a specialist.
No coverage for out-of-network providers; If you see a provider who is not in your plan’s network, you will have to pay the full cost without reimbursement.
Lower premium than a PPO.
It is usually offered by insurers.
Little or no paperwork.
POS You can see doctors inside and outside the network. As always, out-of-network medical care is at your own expense.
Greater freedom to choose your health care providers.
A primary care physician is available to coordinate your care and refer you to specialists.
If you go out of network, you must pay your medical bill. Then submit a claim to your POS plan for reimbursement.
HDP/HSA
(Catastrophic Plans)
Anyone in the plan’s network; individual plans may have additional rules about specialists.
Lower premium.
3 primary care visits before deductible applies.
Free preventive care, even if you haven’t met your deductible.
You’ll need to track your medical expenses to show that you’ve met your deductible. Save all your receipts.
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