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The Best Affordable Health Insurance Companies

Few topics are more confusing for U.S. consumers than health insurance. In some areas of coverage, health insurance isn’t insurance at all. Instead, many health services are offered at a discounted rate, which makes these elements of the best affordable health insurance companies more like a service plan you might buy for a car or an appliance.

Critical illness expenses are handled in a way that’s closer to true insurance but can still leave you with massive medical bills as deductibles, copays, coinsurance, fees and exclusions reduce coverage benefits. It’s often the risk of critical illness or major injuries that has many households looking for an affordable health care coverage solution.

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Quick Look: The Best Affordable Health Insurance Providers

Factors that Drive Health Insurance Costs

In recent years, health insurance costs have risen faster than the rate of inflation, becoming nearly 18% of GDP in 2017. Numerous changes in legislation make finding a specific cause for rising costs a challenge and its likely that many factors contribute to the higher costs of health care.

On an individual level, there are certain factors that affect health insurance costs. The predominant factors are:

  • Location: The state you live in or even your zip code can affect health insurance rates.
  • Age: Health insurance becomes increasingly expensive as you get older.
  • Smoking: The ACA permits insurers to charge smokers more for health insurance. The difference in cost between a smoker and non-smoker can be as high as 50%, although this amount often varies by state and some states prohibit the practice.

Which Health Insurers are Available in All States?

Because each state has its own rules for insurers, many insurers don’t offer plans nationwide. Even where coverage is available in every state, the type of coverage available can vary.  However, your health insurance usually covers you wherever you travel in the U.S. If you move to a new state, you’ll need a new plan, but travel coverage is unaffected within the U.S. once you have a plan.

Most health insurers have gravitated toward offering plans through the Marketplace at healthcare.gov. Depending on where you live, you may find several other private market options available in your state or you could find none.

Types of Health Insurance Plans

Open Enrollment

In many areas, most of the health insurance options available will be plans offered through the Marketplace. Many states also direct health insurance inquiries to the Marketplace at healthcare.gov.

The most recent open enrollment ran from Nov. 1, 2018 to Dec. 15, 2018. Some states have extended open enrollment and there are several ways you can still enroll if open enrollment has ended.

Dates outside of open enrollment are called the Special Enrollment Period (SEP) and if you have a qualifying life event you can still get or change coverage.

Qualifying life events for SEP include:

  • You lost qualifying health coverage in the past 60 days.
  • You or someone in your household got married.
  • You had a baby.
  • You gained or became a dependent.
  • You got divorced or legally separated and lost your health insurance.
  • A death in the family changed your eligibility for a Marketplace plan.

If none of these life events apply or if you simply want to purchase coverage without purchasing through the Marketplace, you have some options. You might consider working with a health insurance broker who can provide you with your options both through the Marketplace or through private plans.

Private Health Insurance Plans

Your options for private health insurance plans are likely to be limited in many areas of the country, but there may still be some good options, depending on where you live. Private health insurance plans may meet the requirements of ACA or state mandates.

However, don’t expect any subsidies for plans purchased outside of state exchanges or healthcare.gov.

Indemnity Plans

Many insurers offer what are called indemnity insurance or fixed-benefit insurance. You can think of an indemnity plan as a discount plan. If you have a qualified medical expense, you submit a claim and the insurer pays you the amount specified in the plan for that service. In many cases, people who purchase indemnity plans do so to supplement existing health insurance coverage.

Indemnity plans aren’t ACA plans and don’t meet ACA requirements. Because there’s no longer a federal penalty for not purchasing an ACA-qualified plan in 2019, this may be less of a concern for some households. However, be aware of state individual mandates as well if you consider an indemnity plan.

Short-Term Health Insurance Policies

A commonly-chosen option for consumers who missed open enrollment and don’t have a qualifying life event for special enrollment, short-term health insurance policies can provide an affordable interim solution. Short-term health insurance is designed to meet the temporary needs of people in good health under age 65.

HealthShare Programs

The ACA brought a rise in popularity to HealthShare programs, which differ from health insurance in many ways but are exempt from ACA requirements and can provide more freedom with regard to health care choices. Often, HealthShares are more affordable on a monthly basis as well.

HealthShare members pay a share amount each month, which is similar to a premium with traditional health insurance. Expect to pay many smaller expenses out-of-pocket while larger expenses can be paid by the contributions made to the HealthShare by its members. Most HealthShares are faith-based, meaning you need to sign a statement of faith. Some HealthShares do not accept smokers or people with pre-existing conditions.

Metal Plans through Healthcare.gov

The plans available on the Marketplace are divided into four categories, which you can think of as coverage levels. The most noticeable difference between the plan categories for consumers is the average amount of medical expenses covered. You might find a few providers within each category, or you may find only one, depending on your location.

Plan categoryPlan shareYour share
Bronze60%40%
Silver70%30%
Gold80%20%
Platinum90%10%

Monthly premiums increase as you move up in category level as does coverage share. The more affordable bronze category covers a lower share of medical expenses, potentially leading to large out-of-pocket expenses. If you are expecting significant medical needs or cannot afford a surprise bill, the lower metal categories may not be a good fit.

If your income qualifies, you may be able to get a premium tax credit. For example, the lowest-cost bronze plan in Phoenix, Arizona is $333 per month. If your income qualifies, the tax credit can reduce your monthly premium to $8. Bronze plans, however, have higher out-of-pocket costs and do not qualify for cost-sharing reduction subsidies that are available for other metal levels.

Understand Out-of-Pocket Limits

When you buy insurance of any type, consider your potential out-of-pocket costs. ACA Marketplace plans have an out-of-pocket limit that caps your exposure but plans with the lowest out-of-pocket limits typically have higher premiums.

Out-of-pocket costs include your deductible and your copays as well as any coinsurance expenses that may apply to your care and are capped on an annual basis. A plan with a $4,400 out-of-pocket limit means your total costs excluding premiums won’t exceed $4,400 for the year. After you reach your out-of-pocket limit, health insurers cover 100% of covered health care costs for the remainder of the year. The upper limit for per-person out-of-pocket costs for 2019 is $7,900, so out-of-pocket costs can be a tall hurdle to clear if your medical needs are high in a given year.

Choosing Between an EPO, HMO and PPO

If you have a preference of which doctor or hospitals you would like to use, the type of health insurance plan you choose can make a difference.

  • Preferred provider networks (PPOs) provide the most freedom to receive care from any provider, including providers outside the network. Expect to pay a bit more for the freedom of choice.
  • Health maintenance organizations (HMOs) use their own network of doctors and hospitals which allows the HMO to negotiate fixed prices for services. Premium costs tend to be lower for HMOs, but out-of-network care is not covered (except for emergencies) and referrals are typically required before the plan will pay for a specialist.
  • An EPO is an exclusive provider organization, which is similar to an HMO but often does not require a referral to see a specialist.

Best Health Insurance Providers

Health insurance providers vary from state to state. Below are some of our top picks based on customer service, average costs and the size of each network. Bigger networks are found in more states, but when searching for health insurance, your choices can vary considerably from one state to the next.

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UnitedHealthCare

With about 13% of the health care market, UnitedHealthCare is the largest health insurance provider in the U.S. United has nearly 900,000 health care professionals in its network, increasing the chance that your preferred provider is already a member and can be used with HMO or EPO plans.

Over the years, UnitedHealthCare has earned several J.D. Power awards, including awards for health care experience in Arizona and for provider choice in Texas.

Kaiser Permanente

Although a much smaller network than UnitedHealth Group, Kaiser Permanente maintains a network of hospitals and medical centers throughout several states.

All of Kaiser Permanente’s plans offer an HSA option, which means deductibles tend to be higher, but premiums are often lower as a result. If you’re in good health and live in an area serviced by Kaiser Permanente’s 22,000 participating physicians, a Kaiser Permanente plan combined with an HSA can be an effective way to keep health insurance costs affordable.

BlueCross BlueShield

BlueCross BlueShield (BCBS) is a nationwide health insurance provider made of up dozens of independently operated companies. While BCBS offers coverage over a broader geography, service quality and plans vary based on location because the insurer works through smaller regional companies.

Coverage options range from group health insurance for employers to individual and family plans to short-term health insurance, the latter of which can be useful if you find yourself shopping outside of open enrollment.

Cigna

If you’re in one of the 12 states serviced by Cigna, you can purchase ACA-compliant health insurance through Cigna, ensuring coverage for essential medical care. Cigna also offers dental plans as well as health insurance for travel.

Short-term health insurance plans are not available through Cigna, however, so you may have to source a plan elsewhere outside of enrollment periods.

Cigna has serviced its customers for over 200 years and places a focus on innovation, such as telehealth, a convenient way to access medical care by phone or through video chat.

Final Thoughts on the Best Affordable Health Insurance Companies

As you choose health insurance, each household has unique priorities and concerns. Keep a close eye on deductibles, copays, coinsurance percentages and out-of-pocket limits. A plan with a low premium may shift the financial risk to you and your family. If you find a plan that looks good, research the company in your state rather than rely on data or awards for all regions.

Because plans can differ dramatically from one state to the next, you’ll want to find answers that apply to the plans available in your state.

Looking to learn more about finding affordable health insurance? Check out Benzinga’s guides to finding the best short-term health insurance companies, how to choose a health insurance policies and how health insurance works.

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Pro tip: Compare 2-3 health insurance companies to find the best quote