If you’re considering major medical insurance, it’s important to know the differences between high-deductible plans and traditional major medical insurance. Catastrophic plans are high-deductible plans with a capped annual out-of-pocket limit. These policies are a good choice if you don’t expect to pay much out-of-pocket.
Catastrophic plans
Catastrophic plans for major medical health insurance are available through the Marketplace and offer very low monthly premiums, but high deductibles. These plans are designed to protect you from the worst-case scenarios, but they may not be the best option for everyone. In addition, these plans may not qualify for premium tax credits, so you’ll likely be better off with a bronze plan.
Catastrophic plans are ACA-compliant
Catastrophic plans are health insurance plans that offer specific benefits that may not be available in other types of plans. They are not HSA-qualified, so enrollees cannot contribute to an HSA. However, they do meet certain requirements and may be offered by different insurers.
Catastrophic plans are high-deductible plans
Catastrophic health insurance plans are affordable and provide basic health coverage. They typically have a high deductible and lower monthly premiums. However, they do not offer complete coverage and customers must meet specific eligibility requirements. In addition, these plans do not offer premium tax credits. Because of these disadvantages, they may be better suited for people who don’t need coverage for a long period of time.
Catastrophic plans have a cap on annual out-of- pocket expenses
Catastrophic plans require that beneficiaries meet the federal out-of-pocket maximum. Unlike other plans, which require a lower annual limit, catastrophic plans always include a deductible. Deductibles vary from catastrophic to catastrophic plan, but they are always equal to the maximum amount determined by HHS. Catastrophic plans are more expensive than non-catastrophic plans.
Catastrophic plans are not guaranteed issue
Catastrophic plans are designed to offer low premiums while protecting you from catastrophic medical debt. They may not cover essential medical care, such as an annual check-up, and may cover only a limited number of prescription drugs. Once you reach your deductible, however, the plan will cover your remaining expenses. A catastrophic plan will also cost much less than an individual plan.
Short-term medical plans are not ACA-compliant
Short-term medical plans, also known as short-term health insurance, don’t meet ACA requirements because they don’t provide minimum essential coverage. This means that if you get sick, your short-term policy may not renew, or you may have to wait until the next open enrollment period to sign up for coverage. Also, the plan may limit the number of doctor visits that you can receive.
