Under the Affordable Care Act, individual health plans, and small group health insurance plans are categorized into four metal tiers such as Bronze, Silver, Gold, and Platinum. People shopping for health insurance should understand the difference between these four metal tiers so that they make a much-informed choice when purchasing health insurance plans.
Health Insurance Metal Levels
Plans metal tiers represent the split of the cost between members of the plan and the insurance company. The plan metal tiers indicate the amount paid by the members and the amount paid by the insurance company, thereby making it easier for the people to compare health plans. The plan cost-sharing requirements also include the following:
It is the amount in which members need to pay for covered services before the insurer starts paying for the covered services.
It the costs percentage which the insurer pays for covered services after insured have met their deductibles.
It is the amount paid by the members for the covered medical services in addition to the payments made by their insurer.
The cost-sharing breakdown for Bronze and Silver Plans
For the Bronze metal tier plan, members are required to pay 40% of the plan cost, whereas the insurer pays 60% of the plan cost. For Silver-tier plans, members are required to pay 30% of the plan cost, whereas insurers are required to pay 70% of the plan’s cost. In addition to this, the out-of-pocket cost of the insured depends on the amount of healthcare they will need in a given year. However, some of the silver plans come with extra savings on out-of-pocket costs and if members qualify, then they may receive more coverage while paying the same amount. Thus, many silver plans along with these subsidies cover a greater percentage of the total healthcare costs. This further means that silver plans with some subsidies may provide more coverage compared to Gold or Platinum tier plans that are more expensive.
Bronze plans are appropriate for the following individuals:
- Individuals who are in good health
- Individuals who rarely get sick and require few or no medications
- If the beneficiary is enrolled in family coverage, then they have grown-up healthy children who don’t get engage in risky activities.
Silver plans are suitable for the following individuals:
Individuals having a few mild health conditions that require specialist treatment and medication. Though they should not require frequent care nor any of their covered family member.
- Individuals who are healthy and don’t plan sports that may cause serious injuries and have children who are elementary school age or older.
- If the individual and the covered family members are able-bodied and are under the age of 70 years.
Key Difference between Bronze and Silver Plans
Bronze and Silver health insurance plans generally offer similar coverage but there are a few distinctions besides the premium and out-of-pocket costs. Bronze health insurance plans are generally considered as high-deductible health plans, and some plans are even combined with a health savings account to help employees in paying for out-of-pocket expenses. Though, people should know that all Bronze plans are not HSA-eligible. A health plan to qualify as a Bronze plan should meet the following criteria:
- A higher deductible compared to the individual health plan
- A plan having a maximum limit on the annual deductible and out-of-pocket costs.
- A plan providing no coverage until the deductible is met except for expenses like premiums, wellness, and preventive care, post-accident care, and dental and vision expenses.
Under the Affordable Care Act, Silver plans are known as the benchmark plan.
- The second-lowest price ACA Silver plan in a coverage area is a benchmark plan. The cost of this plan is used to calculate premium subsidies for individual plans. Irrespective of the plan an individual choose, he will need to know the cost of the benchmark plan to calculate his final tax premium credit.
- The state uses a benchmark plan to define the essential health benefits for individual and small group health plans.