Health insurance has its place for people who can afford it. But what are the best catastrophic health insurance plans?
Not everyone needs, wants, or can afford a full-fledged traditional health insurance policy with all the bells and whistles. Many of these features needlessly drive up costs, while providing little or no advantage for many policyholders.
Best Affordable Catastrophic Health Plans in CO
Given the insane cost of health insurance products these days, it can be tempting to just go without coverage. Especially if you’re young and/or in very good health.
But going completely unprotected is usually taking a gamble you can’t afford to lose. One medical setback could be enough to set off a chain reaction that leads to lawsuits, wage garnishment, and even bankruptcy.
And it can happen to anyone, at any age.
Catastrophic Health Insurance Plans vs. Catastrophic Health Sharing Plans
If you want a catastrophic-only-focused plan, your choices aren’t limited to traditional health insurance solutions. Currently, there are multiple catastrophic-focused health insurance plans available in Colorado as well.
In this article, we’ll look at both: traditional health insurance solutions as well as two of the best catastrophic health sharing plans on the market today: the Altrua RUBY plan and JHS Community Health Share.
Understanding Catastrophic Health Insurance Plans in Colorado for Families
Catastrophic health insurance plans are designed to offer low-cost, high-deductible coverage primarily for young, healthy individuals.
These plans feature very low monthly premiums, along with very high deductibles – currently as high as $9,450 for individuals, and $18,900 for the family.
If you’re enrolled in a catastrophic-only health insurance plan in Colorado, you would be responsible for covering your deductible each year. But once you’ve met your deductible, your plan will pick up 100% of approved costs after that.
You won’t have to worry about additional deductibles, copays, or coinsurance for the rest of the year.
With these plans, you are essentially betting that you won’t need care during the year. However, if you do need care, you’ve limited your risk to $9,450 or $18,900.
You’ll need to pay a premium each month. And you’ll have to pick up the costs for the small stuff, like scrapes, bruises, sniffles, and sprains. But you’ll be protected against catastrophic, potentially bankrupting medical costs, such as those for trauma care centers, cancer treatments, heart attacks, strokes, surgeries, and severe injuries requiring extensive treatment and rehab.
What Do Affordable Catastrophic Health Insurance Plans Cover In Colorado?
In Colorado and in the rest of the country, catastrophic plans must include the same essential health benefits as other Marketplace plans.
This includes covering certain preventive services at no cost, when provided by in-network providers.
Additionally, Catastrophic plans must offer at least three primary care visits per year before the deductible is met. Once the annual deductible is met, the plan covers 100% of covered services for the rest of the plan year.
Are catastrophic plans eligible for subsidies under the Affordable Care Act?
No. Premium Tax Credits and Cost-Sharing Reductions cannot be applied to catastrophic plans.
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Catastrophic Health Insurance Eligibility
Generally, catastrophic-only health insurance plans are specifically available only to individuals under 30 years old at the start of the plan year, or to those who qualify for a hardship exemption.
If you’re over 30, you can still qualify if you meet one of these exemption eligibility criteria:
Hardship Exemptions
Hardship exemptions can make catastrophic plans accessible to those over 30. These exemptions include:
- homelessness
- eviction or foreclosure
- domestic violence
- death of a family member
- substantial medical debt
- natural disaster
Catastrophic Health Insurance Advantages and Disadvantages
Advantages
- Lower Premiums: Catastrophic plans generally have lower monthly premiums compared to other plans.
- Financial Protection: Provides a safety net for significant medical emergencies and high-cost health issues.
- Preventive Care: Basic preventive care services are covered at no cost.
Disadvantages
- High Deductible: You must pay a high amount out-of-pocket before the insurance kicks in for most services.
- No ACA Subsidies: Premium subsidies cannot be applied to catastrophic plans, making them less affordable for those who qualify for subsidies under other plans.
- Limited Eligibility: Restricted to individuals under 30 or those with a hardship exemption.
Catastrophic Health Care Sharing Plans
Catastrophic health sharing plans are even more affordable than catastrophic health insurance plans.
They don’t have the same legal mandates that traditional health insurance plans do, and are therefore able to streamline and focus their coverage even more.
However, they do have some limitations on what they will share costs for, compared to traditional health insurance plans. For example, some health sharing plans exclude cost sharing for pregnancy and childbirth-related costs, while health insurance plans are required to cover them.
Healthsharing isn’t the same thing as health insurance. Instead, health sharing plans are not-for-profit associations of like-minded, health-conscious, responsible people who agree to help shoulder one-another’s medical burdens in a mutual aid organization.
The health sharing plan simply facilitates fund transfers from sharing members to those with medical needs that month.
Currently, there are two health sharing organizations that offer standout health sharing solutions specifically designed to focus exclusively on catastrophic needs, while keeping monthly costs at rock-bottom levels: The Altrua RUBY-tier plan, and JHS Community Healthshare.
Altrua’s RUBY Tier Health Sharing Plan
RUBY is just one of several available health share plan tiers available from Altrua, a well-established and respected health sharing organization.
The RUBY plan tier works just like other healthshare options, but with a few twists that enhance its utility for people who are willing to take on a certain amount of risk for their own medical bills, but who want to focus their protection on catastrophic needs.
- Individual plans start at $136 per month for individuals, and $265 for a family of four.
- There is no age banding: That monthly cost is the same for all members from age 18 through 64. This makes RUBY particularly competitive as you get older.
- Shares unlimited costs for telemedicine services, no additional charge.
- Members are responsible for an out-of-pocket Member Responsibility Amount (MRA) of $7,500 per year before cost sharing becomes active. After that, the member is responsible for 50% of eligible medical bills, with a cap at $5,000.
While RUBY is extremely affordable, especially for those ages 40 and up, there are some disadvantages to keep in mind:
- RUBY does not share maternity and pregnancy costs
- Mental health benefits are much more limited compared to traditional health insurance plans
- Sharing benefits are limited to $150,000 per year, which may not be enough to fully share costs for major hospitalizations, surgeries, cancers, etc.
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JHS Community Health Share
JHS Community Health Share offers three excellent health sharing plans specifically designed to focus on catastrophic needs, DISTINCT, DIVERSE, and DYNAMIC.
With these plans, you’ll be responsible for the first $2,500, $5,000 or $10,000, and up to 50% of the next $10,000 in medical costs. So your maximum medical cost exposure in most cases is up to $15,000 for an individual.
Once you meet your MRA plans typically share 100% of approved medical costs beyond that.
Like RUBY, these plans can be a great match if you are comfortable paying $10,000 to $15,000 in medical costs out of pocket, but you definitely want protection against large and catastrophic medical needs.
The idea is that you can solve a $15,000 problem. But most people can’t solve a $150,000 problem or greater.
The DISTINCT Tier is the most budget-friendly option, and the most popular. But it doesn’t cover maternity costs. Also, DISTINCT has an annual benefit cap of $250,000––substantially higher than the RUBY plan, and has a lifetime sharing benefit cap of $1 million.
The other two catastrophic-focused plans in the JHS Healthsharing family of plans are DIVERSE and DYNAMIC. DIVERSE will share up to $750,000 per member per year, and up to $2 million over a lifetime.
The DYNAMIC plan tier will share up to $1 million per plan member per year, and up to $3 million over a lifetime.
Both DIVERSE and DYNAMIC share maternity and childbirth-related costs, up to $8,000 and $12,000, respectively, for single and multiple births. Pregnancies and child births with complications qualify for cost sharing up to $40,000. A nine-month waiting period applies before these plans will share maternity costs.
JHS COMMUNITY PLANS AT A GLANCE
| SERVICES | DISTINCT | DIVERSE | DYNAMIC |
|---|---|---|---|
| Adult and child wellness services | No visit fee. Eligible at 100% up to a maximum of $500/year. | No visit fee. Capped at $2,000 for wellness services per member per year. | No visit fee. Capped at $2,000 for wellness services per member per year. |
| Physician, specialist, and urgent care visits | $40 visit fee | $40 visit fee | $40 visit fee |
| Maximum per office visit | $400, up to 4x per member | $400, up to 8x per member | $400, up to 12x |
| MRA options | Choose $2,500, $5,000, or $10,000 per member, per member year-not to exceed 3 family members | Choose $2,500, $5,000, or $10,000 per member, per member year-not to exceed 3 family members | Choose $2,500, $5,000 or $10,000 per member, per membership year - not to exceed 3 family members |
| Additional MRAs | Capped at 50% of next $10,000 per member per membership year. Total AMRAs will not exceed $5,000/member, $10,000 for member+1, or $15,000 for a family membership year. | Shared up to $8,000 for single or multiple births. Life threatening complications for mother and/or new baby, MRA applies up to a Maximum Sharing Limit of $40,000. *Nine (9) month waiting period prior to conception. | Shared up to $12,000 for single or multiple births. Life threatening complications for mother and/or new baby, MRA applies up to a Maximum Sharing Limit of $40,000. *Nine (9) month waiting period prior to conception. |
| Imaging and lab fees | 100% shareable after MrA and AMRA are met | 100% shareable after MRA and AMRA are met | 100% shareable after MRA and AMRA are met |
| ER Visits | $400 visit fee, then shared up to $4,000/family member/year | $400 visit fee, then shared up to $8,000 per family member/year. | $400 visit fee, then shared up to $12,000 per family member/year. |
| Hospitalization | 100% shareable after MRA and AMRA are met. 90-day waiting period for non accidental injury. | 100% shareable after MRA and AMRA are met. 90-day waiting period for non-accidental injury. | 100% Shareable after MRA and AMRA are met. 90-day waiting period for non-accidental injury. |
| Surgery | 90-day waiting period for other than accidental injuries. 100% shareable after MRA and AMRA are met. | 90-day waiting period for other than accidental injuries. 100% shareable after MRA and AMRA are met. | 90-day waiting period for other than accidental injuries. 100% shareable after MRA and AMRA are met. |
| Maternity Care | Not eligible. | Shareable up to $8,000/ member for single or multiple births. Life threatening complications for mother and/or new baby, MRA and AMRA apply up to a Maximum Sharing Limit of $40,000. *Nine (9) month waiting period prior to conception. | Shareable up to $12,000/ member for single or multiple births. Life threatening complications for mother and/or new baby, MRA and AMRA apply up to a Maximum Sharing Limit of $40,000. *nine (9) month waiting period prior to conception. |
| Maximum sharing limit | $250,000 per member/year | $750,000 per member/year | $1 million per member/year |
| Lifetime sharing limit per member | $1 million | $2 million | $3 million |
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Which Plan is Best For You?
That’s a highly individual and situation-dependent decision.
If you want a traditional health insurance plan, including a full-fledged prescription drug component, and you meet the eligibility criteria, you should consider a catastrophic health insurance policy.
If you are in good health with a very low risk of injury, and no family history of hereditary health problems, the RUBY plan can be a good call – especially if you are very cost-sensitive, and older than 30 or 40. The lack of age banding in the RUBY plan may enable you to accumulate savings much faster.
However, many people appreciate the additional safety net offered under the higher-tier JHS Healthshare plans, especially.
Again, you can get free, personalized help analyzing your personal situation and needs and choosing the catastrophic plan that best fits your individual circumstances by making an appointment with one of our highly-qualified Personal Benefits Managers.
For Further Reading: The ColoHealth Health And Wealth Newsletter: Catastrophic Health Insurance|The Best Health Plans in Colorado for Families
Christine Corsini is a health insurance and medical cost sharing expert, and a Personal Benefits Manager at ColoHealth. Her goal is to help people embrace life’s amazing possibilities by staying healthy, saving money, and making the best decisions when it comes to healthcare.
