With so many types of health insurance plans and options, it can be challenging to decipher, which is the best and most affordable for you and your family. As you weigh your considerations and compare plan costs, it’s important to know about some of the unique programs for which you might be eligible. Today, we’ll discuss everything you need to know about catastrophic health insurance, an option you may not realize you have.
What Is Catastrophic Health Insurance All About?
For some Americans, especially this year, financial hardships are realities. And if you consider yourself one of these individuals, whether it be due to job loss or other circumstances, catastrophic health insurance may be an option for you. Open Enrollment is happening now. So, you’ll want to know about all of your available plans.
What Is a Catastrophic Health Insurance Plan?
Catastrophic health insurance plans are available to a specific group of people who need minimal coverage and rock-bottom monthly premiums. And the need for these coverage and price points is determined by a proven financial hardship. Generally, individuals who consider themselves relatively healthy, without ongoing medical issues find these plans ideal. Again, the financial hardship is a prerequisite, meaning traditional Marketplace insurance options are beyond a reasonable limit of affordability.
Who It’s Designed to Help
Catastrophic plans are designed to help those who have experienced significant financial setbacks that make even the benchmarks for “affordable health insurance” seem too high. These plans offer worst-case scenario coverage, including hospitalizations or major injuries. Some routine healthcare appointments or specialist care visits may become out-of-pocket expenses. The trade-off for low monthly premiums is higher deductibles, as well.
Two Primary Eligibility Requirements
There are limitations to catastrophic health insurance eligibility. Only those individuals who are 30 years old or younger can have access to these low-premium plans. There is also a requirement to demonstrate the existence of a hardship exemption. You will have to prove why Marketplace or employer-based health insurance is unaffordable. If you have lost your job, for example, you could qualify. Once those two criteria are met, the plans will be displayed as options within the Marketplace right now.
What Catastrophic Health Insurance Covers
Catastrophic health insurance plans offer limited coverage. And these compromises may be worth it for you if the finances are burdened this year. Here’s what you can expect from a catastrophic plan.
Essential Health Benefits
The Affordable Care Act outlines certain guidelines that include a set of ten categories of coverage. Catastrophic health insurance plans are required to meet these benchmarks of coverage, as well as traditional Marketplace plans. These essential benefits include mental health, pregnancy care, and both inpatient and outpatient hospital care.
Some Preventive Care Visits Are Still Free
Some preventive care visits are required by the ACA to be provided free of charge. Each plan will outline what constitutes a preventive care service and could include screenings, shots, and lab work. There may be provider network requirements, meaning only those doctors or healthcare facilities partnered with the catastrophic plan provider are considered in-network.
Primary Care Visits
According to Healthcare.gov, catastrophic health insurance plans will also cover a minimum of three primary care visits during the plan year, prior to meeting the deductible. Primary care visits can apply to all covered adults under the plan and include women and children-specific healthcare services.
What Catastrophic Health Insurance Costs
Finding your ideal health insurance plan may boil down to cost. One of the primary benefits of catastrophic plans is affordability. Here’s how to compare costs to determine how to make your plan selection.
As we previously mentioned, the monthly premiums associated with catastrophic health insurance are typically reduced and very low. However, you won’t be able to use those premium tax credits to reduce the monthly premiums like you would with more traditional plans. Before selecting a catastrophic plan, do the math on any premium tax credits for which you might qualify. A bronze or silver plan might end up being cheaper.
The deductibles for any plan are important to consider when calculating what you can afford. But it’s critical that you take a look at the deductibles listed for each catastrophic health insurance plan you’re considering as well. They will be much higher than you’re used to seeing with more traditional insurance plans. In 2019, catastrophic plans had a deductible of $7,900. For this year, deductibles for all catastrophic plans is $8,150. You’ll need to be mindful of these amounts as you calculate which plan is best for you.
Copayment & Coinsurance Costs
Once you’ve met your deductibles, the catastrophic insurance provider will cover any remaining services billed. That means no copayment or coinsurance percentages beyond your max deductible. But again, that only applies to services during the active coverage year. And only after you’ve met your deductible thresholds.
The COVID-19 Concerns
The pandemic has brought increased concerns and questions, especially when it comes to health insurance coverage. There have been provisions and official statements that might help put your mind at ease about facing the months ahead with COVID-19 still looming in so many regions of the country.
Earlier this year, and when the pandemic began affecting larger populations, the Department of Health & Human Services, along with the Centers for Medicare & Medicaid Services Center (CMS,) issued statements regarding the new considerations for providers and those insured regarding COVID-19. The officials recognize that the diagnosis and treatment of COVID-19 fall within the ACA’s essential health benefits scope. And earlier this year, the CMS along with HHS granted issuers of catastrophic health insurance plans to cover these Coronavirus-related costs, even prior to enrollees meeting their plan deductibles.
If you’re still weighing all of your available health insurance options via the Marketplace and need guidance, W3LL is here to help. To calculate and compare your premiums with traditional plans and premium tax credits with qualifying catastrophic coverage, W3LL can help you do the math. It only takes answering a few simple questions to get started, and W3LL can help you navigate all the available health insurance plans for this Open Enrollment, absolutely free of charge.