Shopping for health insurance can be an overwhelming experience, especially when policies have their own complex rules, premiums, and cost-sharing structures. Thankfully, a provision of the Affordable Care Act made it easier to compare plans side by side with the metal tier system. The metal tier system divides healthcare plans by premium prices and cost-sharing rules. If you’re looking to find affordable health insurance that will fit your budget, read on to learn more about how metal tiers can help you find just the right plan.
What is the Affordable Care Act?
The Affordable Care Act (ACA), also known as ‘Obamacare,’ is a health insurance reform law enacted in March 2010. Its three primary goals are to increase access to affordable healthcare, expand the Medicaid program to cover families living under the federal poverty level, and to support medical innovations that help lower healthcare costs. These provisions are a part of the government’s larger objective goal to assure that everyone in the U.S. has access to health insurance. To make it simpler for individuals and families to shop for affordable healthcare, insurance plans on the ACA Marketplace are categorized into metal tiers that are based on total costs.
Purpose of the Affordable Care Act
The ACA was created to expand healthcare access to the millions of Americans living uninsured. In order to do so, the ACA focuses on reducing the cost of health insurance by offering cost-sharing reductions, tax credits on premiums, and setting a maximum out-of-pocket limit. Provisions of the ACA also allow for more accessible ways to obtain healthcare. Health insurance companies are prohibited from denying an applicant based on any pre-existing health conditions and insurance policies are required to cover the ten Essential Health Benefits. Some of these benefits include outpatient services, prescriptions, preventative care, and pediatrics, among others.
The Creation of Metal Tiers
On the ACA Marketplace, health plans fall into one of four categories known as metal tiers. Metal tiers are determined by cost-sharing structure –– how a policyholder and their insurer split medical costs. It’s important to note that despite the difference in cost, all metal tiers provide the same quality of medical care under the ACA. The four metal tiers are Bronze, Silver, Gold, and Platinum.
Bronze
Bronze plans offer the lowest monthly premiums but require the highest out-of-pocket costs.
Because premiums are so low, deductibles and out-of-pocket maximums are typically very high. Bronze plans are the best choice for those who maintain a healthy lifestyle, do not have pre-existing conditions, and do not need medical services frequently.
Silver
Silver plans offer a moderate monthly premium and require a moderate amount of out-of-pocket costs. They are the most popular among ACA Marketplace shoppers because they fall in the middle – you pay a moderately-priced premium for less financial burden on routine care costs. Silver plans are the best choice for those who qualify for or are interested in extra savings.
Gold
Gold plans require a high monthly premium but offer low out-of-pocket costs. Deductibles are typically low and would be of good value to those who need regular routine visits. Gold plans are the best choice for those with existing conditions who need routine medical visits often or families with young children who need frequent pediatric care.
Platinum
Platinum plans require the highest monthly premium but offer the lowest out-of-pocket costs. Although premiums payments are high, a majority of medical expenses will be covered by the insurer. Platinum plans are the best choice for those who need frequent and/or expensive medical care due to a chronic illness or condition.
Tiers and Insurance Plan Split Costs
Each metal tier is separated by how insurance companies split costs with policyholders. Cost-sharing is an essential component of health insurance, as it helps both you and your insurance provider afford the high costs of healthcare.
Each tier has its own structure for splitting healthcare costs. Silver plans exclusively provide extra savings for policyholders by offering lower deductibles, lower co-payments, and lower out-of-pocket maximums. Plans in any of the metal tiers offer free preventative care and may offer discounts on medical services before you reach your deductible.
The table below lists the average split-cost percentage between an insurer and a policyholder.
| Metal Tier | Policyholder Pays | Insurer Pays |
| Bronze | 40% | 60% |
| Silver | 30% | 70% |
| Gold | 20% | 80% |
| Platinum | 10% | 90% |
Metal Tiers and HSA
A Health Savings Account (HSA) is a bank account used to pay for qualifying medical expenses. You can deposit money up to the IRS limit – $3,550 for individuals and $7,100 for families in 2020 –– and allocate it towards health expenses. The money deposited and withdrawn from an HSA is tax-free/tax-deductible, so you can save on taxes. HSAs are reserved for those with high-deductible health plans to help pay for out-of-pocket expenses. Those enrolled in Bronze or Silver plans may qualify for an HSA due to their high deductibles and out-of-pocket maximums.
Lowering Metal Tier Premiums
No matter which metal tier your health policy falls under, it’s possible to lower your monthly premium based on your income. When you apply for a Marketplace plan, you may be eligible for a premium tax credit that will reduce how much you pay each month. Find out if you qualify through the HealthCare.gov savings calculator.
How to Sign Up for a Metal Tier Insurance Plan
Now that you’ve learned some more about the metal tier system, it’s time to find the plan that works best for you. Use our online form to request personalized quotes and compare rates amongst providers. Open Enrollment begins in November, but you can find out if you qualify for Special Enrollment here. We wish you the best of luck on your health insurance search!
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