Catastrophic Health Insurance Plans in Colorado: Who Qualifies & How It Works

by | Jan 21, 2025 | Colorado Health Insurance, Health Insurance | 0 comments

Catastrophic Health Insurance Plans in Colorado Who Qualifies How It Works
If you’re looking for an affordable way to protect yourself against high medical costs, and you’re on a budget, a catastrophic health insurance plan might be the right choice for you.

Catastrophic Health Insurance Plans in Colorado Who Qualifies How It Works

These plans are designed for Colorado residents who want a safety net for major health events while keeping monthly premiums low.

But they aren’t available to everyone.

Here’s everything you need to know about catastrophic health insurance plans in Colorado, who qualifies for them, and how they compare to other options like health sharing plans.

What Are Catastrophic Health Insurance Plans?

Catastrophic health insurance plans are designed to cover worst-case scenarios, such as major injuries or illnesses.

They offer low monthly premiums but come with high deductibles and out-of-pocket maximums. For 2025, the maximum out-of-pocket costs for catastrophic plans are capped at $9,200 for an individual and $18,400 for a family.

These plans cover the same essential health benefits as other Affordable Care Act (ACA)-compliant plans, including:

  • Emergency services
  • Hospitalizations
  • Preventive care
  • Prescription drugs

However, catastrophic plans only cover three primary care visits per year before the deductible is met.

After that, you’ll pay all medical expenses out of pocket until you reach your deductible.

These plans are most suitable for people in very good health, who don’t expect to need to see a doctor this year, don’t consume much healthcare, don’t have any significant pre-existing conditions, and who want or need to keep their monthly costs as low as possible.

The plan won’t do you any good for minor ailments, likes sprains and minor fractures. But it will still provide significant protection against major medical events like heart attacks, surgeries, and cancer diagnoses, each of which can cost six figures and up.

Your loss will be limited to the maximum out-of-pocket cost.

Who Is Eligible for Catastrophic Health Insurance in Colorado?

Catastrophic health insurance is only available to specific groups of people:

  • Age Requirements: You must be under 30 years old.
  • Hardship or Affordability Exemptions: If you’re over 30 and can demonstrate economic hardship or that other insurance options are unaffordable, you may qualify for a catastrophic plan.

Examples of hardship include:

  • Being homeless
  • Facing eviction
  • Experiencing domestic violence
  • Declaring bankruptcy

If you’re unsure whether you qualify, a ColoHealth Personal Benefits Manager can help you navigate the eligibility requirements and apply for a hardship exemption if needed.

Make an appointment for a free consultation with a ColoHealth Personal Benefits Manager.

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Advantages of Catastrophic Plans

  • Low Premiums: These plans typically cost less than Bronze-tier plans, making them affordable for people on tight budgets.
  • Protection from Medical Bankruptcy: With a catastrophic plan, your maximum out-of-pocket costs are capped, protecting you from crushing medical debt.
  • Essential Benefits Coverage: You’ll receive the same essential health benefits as other ACA plans.
  • Preventive Care: Preventive services, such as vaccines and screenings, are fully covered even before meeting your deductible.

Disadvantages of Catastrophic Plans

  • High Deductibles: You’ll pay out of pocket for most medical expenses until your deductible is met.
  • Limited Coverage for Routine Care: Only three primary care visits per year are covered before the deductible applies.
  • Eligibility Restrictions: Not everyone qualifies for these plans, limiting access to those who meet specific criteria. You must be under 30, or qualify under economic hardship criteria.
  • No subsidies. Catastrophic-only plans do not qualify for premium tax credit subsidies under the Affordable Care Act. On the other hand, depending on your income, opting for a Silver plan could cost you as little as $10 per month.

Who Should Consider a Catastrophic Plan?

Catastrophic health insurance is ideal for individuals who:

  • Are young and healthy, with minimal medical needs
  • Want protection against unexpected high medical bills
  • Are looking for the lowest possible premiums
  • Can afford to pay out of pocket for routine medical expenses

If you’re older or have ongoing medical needs, a different ACA  Marketplace plan or a health sharing option may better suit your needs.

Comparing Catastrophic Plans to Health Sharing Plans

If you’re exploring low-cost alternatives to traditional health insurance, health sharing plans like JHS Community Healthshare and the Altrua RUBY plan might appeal to you.

Here’s how they stack up against catastrophic plans:

JHS Community Healthshare

  • Monthly Costs: Typically much lower than catastrophic plan premiums.
  • Shared Responsibility: Members contribute to a pool that shares eligible medical expenses.
  • Flexibility: No restrictive networks; members can choose any provider.
  • Limitations: Waing periods on pPre-existing conditions. No built-in prescription drug insurance.

Altrua RUBY Plan

  • Monthly Costs: Comparable to catastrophic plan premiums.
  • Coverage: Includes limited sharing for doctor visits, hospitalizations, and emergencies.
  • Faith-Based Principles: Members must adhere to lifestyle guidelines consistent with the plan’s values.
  • Limitations: Waiting periods on pre-existing conditions. No built-in prescription drug insurance.

Key Differences

  • ACA Compliance: Catastrophic plans comply with ACA requirements, while health sharing plans do not.
  • Eligibility: Catastrophic plans have strict age and exemption requirements, whereas health sharing plans are open to a broader audience.
  • Pre-existing Conditions: Catastrophic plans, like other ACA-compliant plans, cover costs related to pre-existing conditions right away. Health sharing plans, including JHS and Altrua RUBY, impose a waiting period before they will share costs related to pre-existing conditions.

Preventing Bankruptcy with a Catastrophic Plan

Medical debt is a leading cause of bankruptcy in the U.S. Catastrophic health insurance provides critical financial protection by capping your out-of-pocket costs, even in the event of a major health crisis.

For Colorado residents worried about unexpected medical expenses, these plans can offer peace of mind without breaking the bank.

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Take the Next Step

Whether you’re considering a catastrophic health insurance plan or exploring other affordable options like health sharing, ColoHealth can help.

Contact a Personal Benefits Manager today for a free consultation. We’ll guide you through your choices, help you determine your eligibility, and find a plan that fits your needs and budget. Protect your health and your finances—get started now.

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