When you shop for individual or family health insurance plans that qualify as Affordable Care Act plans, you’ll notice that they carry the names of metals: Bronze, Silver, Gold and Platinum.
The ACA Health Insurance Marketplace (healthcare.gov) also includes a fifth plan type: catastrophic health plans. With the good metal names already taken, these plans are usually just called … well, “catastrophic health plans.” They provide very basic coverage and are typically for those under age 30.
The metal levels are meant to help health plan shoppers understand the “actuarial value (AV)” of an ACA Qualified Health Plan (are you still awake?) — or, to put it another way, what general share of covered medical expenses a health plan will pay versus what share of expenses a member can expect to pay.
As with any type of insurance, there is a trade-off between the monthly premium you pay for a health plan and how much it will cover of your costs during the year. In general, the lower the premium amount, the more you will pay on your own when you have certain health care services. The higher your monthly premium, the more the plan will pay for your care.
A plan’s metal level gives you an idea of its trade-off between premium cost and how much of your expenses will be covered. On average, the percentage each metal-level plan type will pay toward your essential health benefits (note that these are not coinsurance percentages) is as follows …
If you’re shopping for a plan for yourself or your family, these are important things to remember. Our chart below shows you the relationship between these cost variables and which plan metal level you might want to consider based on your own health or financial situation.
As of June 2015, according to the Kaiser Family Foundation, two thirds of the nearly 10 million people who have bought coverage on healthcare.gov chose Silver plans. Here’s something that might account for Silver’s popularity: You must choose a Silver plan to qualify for the government’s “cost sharing reduction” aid, which can help pay for your health care costs.
Bronze plans were second in popularity, followed by Gold, Platinum and Catastrophic (which not everyone qualifies for).
All of the metal level plans provide coverage for 10 “essential health benefits” (see below).
Qualified ACA plans consider in-network preventive care services, such as colonoscopies, diabetes screenings and annual wellness visits, to be essential health benefits — and cover them without any cost to you.
It’s important to remember that the different metal names are in no way associated with the quality or number of health care services you get when you buy one of these plans. The metal names are only meant to indicate a level of premium and out-of-pocket costs.
One of the first significant health care reform efforts to extend coverage to more people and make it more affordable happened in Massachusetts in 2006 — before the federal Affordable Health Care Act was born. The story goes that a marketing officer in charge of naming the health plans there was considering names with historic significance. “The Patriot Plan” was on his short list. So was “The Minute Man Plan.” (You can’t make this stuff up.)
After hearing his ideas, his wife suggested that he use the name of the medals in the Olympics instead: Bronze, Silver and Gold. She said that consumers would know instantly that a Silver Plan was “better” than a Bronze Plan and that a Gold Plan was “better” than a Silver Plan.
Later, with national health care reform, the ACA decided to adopt the Massachusetts metal level names on healthcare.gov, its federal insurance exchange.
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