Bronze, Gold, Silver, and Platinum Plans

What’s the difference between the health plans that will be offered through the health insurance exchanges? One way to tell is by their “metallic” designation. The value of the plan depends on the metal (just like in the Olympics).

The health insurance exchanges are coming soon. Your state might have a state-based exchange, a partnership exchange between the federal government and your state, or a federally run exchange. Certain things will be the same at all exchanges, no matter which way your state selected to go. Every exchange will offer plans that are bronze, silver, gold, and platinum.

Each plan will have an Actuarial Value (also called an AV). The AV is calculated as the percentage of total average costs for covered benefits that a particular plan will cover. For example, let’s say a certain plan has an AV of 70%. That means that the consumer who purchases that plan will be responsible for paying out of pocket for 30% of the costs of all covered benefits.

If you bought that policy before 2014. That means it will be considered a “grandfathered plan”. Your current plan will not be required to meet certain AV levels. Your current plan might, or might not, be better than what you can find through the exchanges.

Starting in 2014, all “non-grandfathered” health insurance plans will have to meet certain AV’s. This is true for plans in the individual market and the small group markets. When you look at the health plans offered in the exchanges, it is important that you check the “Metal level” of the plan.

The easiest way to keep the metals in order is to think of it like the Olympics. Bronze is the lowest one, and gold is the highest. The exchanges will also have platinum, which is higher than gold.

Bronze Plan
It gives the least amount of coverage. The insurer pays for 60% of the cost of your medical bills, and you have to pay the other 40% out of your own pocket.

Silver Plan
This is better. The insurer pays 70% of the cost of your medical bills. This leaves you responsible for the remaining 30% of the cost.

Gold Plan
This is even better. The insurer pays 80% of the cost of your medical bills. You end up paying the leftover 20% out of your own pocket.

Platinum Plan
It provides the highest percentage of coverage. Your insurer pays 90% of the cost of your medical bills. You only have to come up with the remaining 10% out of your own pocket.

Image by cliff1066 on Flickr

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