How to buy an individual health insurance plan – Insurance.com

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Most Americans obtain their health insurance through their employer, Medicare, or Medicaid. However, if you are ineligible for any of these plans, there is another option available: individual health insurance. These plans offer similar benefits to those provided by most employer plans, and depending on your income, you may even pay less for individual health coverage than for employer coverage.

Individual health insurance can be obtained through federal and state Affordable Care Act (ACA) exchanges, as well as directly from insurance companies. If you are eligible for a plan through these avenues, you cannot be denied coverage. Additionally, depending on your income, you may also be eligible for ACA plan subsidies.

Reading: Where to purchase individual health insurance

How to Acquire Individual Health Insurance

Healthcare.gov offers comparison tools, cost calculators, and educational resources to help you select the right plan for you and your family. The website can also assist you in estimating any premium subsidies you may be eligible for. If you reside in one of the 17 states with its own exchange, you can use your state’s website to sign up. These states include California, Connecticut, the District of Columbia, Idaho, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Pennsylvania, Rhode Island, Vermont, and Washington.

For all other states, you can enroll through the federal government’s health insurance exchange, healthcare.gov. It is important to note that not all insurers sell plans through the government-run health insurance marketplace. If you decide to shop outside of the exchanges, keep in mind that these plans are not eligible for subsidies.

Now, let’s explore when you can purchase individual health insurance and the various plan options available.

When to Buy an Individual Health Plan

You can buy or make changes to individual health insurance during the open enrollment period, which for most states occurs from November 1st to January 15th. Some states, such as California, the District of Columbia, Idaho, Maryland, New Jersey, New York, and Rhode Island, have slightly different open enrollment periods.

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Another opportunity to secure individual health insurance coverage arises when you experience a qualifying event that triggers a special enrollment period. These events may include losing your health insurance coverage, getting married, having a baby, moving, becoming a US citizen, getting out of jail, losing eligibility for Medicaid or the Children’s Health Insurance Program (CHIP), a change in income or household status that affects your eligibility for premium tax credits or cost-sharing subsidies, or gaining status as a member of an Indian tribe. The special enrollment registration period typically lasts for 60 days.

Starting in 2022, low-income Americans will have increased access to plans from the Marketplace. People with incomes up to 150% of the federal poverty level will be eligible for a special enrollment period each month, providing greater flexibility. It is estimated that approximately one-third of Marketplace plan members will qualify for this extended enrollment opportunity.

Do I Need Individual Health Insurance?

If you are not eligible for employer-sponsored health insurance, Medicare, Medicaid, veterans benefits, or any other government program, it is necessary to purchase individual health insurance. You can buy individual health insurance through the ACA marketplace, as well as non-ACA policies through brokers and directly from insurance companies.

What Do Individual Health Plans Cover?

ACA marketplace individual health insurance plans offer comprehensive coverage. Regardless of your health history, marketplace plans must offer you coverage, including for pre-existing conditions and pregnancy. These plans also have a set of 10 essential health benefits that they must cover, such as doctor visits, hospitalizations, prescription drugs, and preventive services. In contrast, plans that do not comply with the ACA may be less expensive but provide limited benefits and can deny coverage based on your health history.

How to Choose Individual Health Plans

There are different types of individual health plans available. Plans offered on the ACA market are divided into four metal tiers: Platinum, Gold, Silver, and Bronze. These tiers indicate the percentage of medical costs paid by the plan. Higher-tier plans have higher premiums but lower out-of-pocket costs, while lower-tier plans have lower premiums but higher out-of-pocket costs. When selecting a plan, it is essential to consider the medical services you used in the previous year and what you anticipate needing in the coming year. Healthcare.gov and individual state websites provide calculators to assist you in determining which plan best suits your needs.

How Much Does It Cost to Buy Health Insurance on Your Own?

The cost of buying health insurance on your own depends on several factors. Generally, the less you pay out-of-pocket for deductibles, copays, and coinsurance, the more you will spend on premiums. Platinum plans have higher premiums but lower deductibles, while bronze plans have lower premiums but higher out-of-pocket costs. When deciding on a plan level, it is important to consider your expected future healthcare needs. According to the Kaiser Family Foundation (KFF), the average premiums for bronze, silver, and gold plans are:

  • Bronze: $440 per month
  • Silver: $481 per month
  • Gold: $578 per month

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Bronze and silver plans are the most popular, with 32% and 56% of policyholders opting for these plans, respectively. Gold plans are chosen by only 10% of policyholders, while platinum plans are selected by just 1%.

What Is the Cheapest Health Insurance?

The most affordable premiums are offered by the bronze plans. If you qualify for subsidies, the cost of silver and bronze plans may be similar. It is crucial to compare these plans to non-compliant alternatives before making a decision, as the latter may be less expensive but offer limited benefits.

Individual Health Insurance Subsidies

Individuals who purchase health insurance through the ACA exchanges may be eligible for subsidies that reduce the cost of premiums. These subsidies are provided in the form of tax credits and grants. To be eligible for subsidies, your household income must be below 400% of the federal poverty level. The 2021 US bailout increased grants as part of pandemic relief, but these increased grants will expire unless extended by Congress. When using the ACA exchanges to search for a plan, the website provides cost estimates that include the subsidies available to you. However, individuals with an individual health plan outside the exchanges are not eligible for subsidies.

Other Options for Health Insurance

Individual health insurance is one option for obtaining coverage, but there are other alternatives to consider. These include short-term plans, Medicaid, and catastrophic health plans. Short-term plans offer lower costs but have limited benefits and are not intended for long-term coverage. Medicaid is available to those who qualify and provides comprehensive health insurance at lower costs. Catastrophic health plans are available to individuals under 30 or those who meet the income requirements. These plans have lower premiums but higher deductibles and out-of-pocket costs.

What to Consider When Buying Individual Health Insurance?

When shopping for an individual health insurance plan, it is important to consider your healthcare needs and budget. Some questions to ask yourself include:

  • How much flexibility do you want in your plan? Consider the type of benefit design, such as HMO, EPO, or PPO.
  • Are your preferred providers in the network? Ensure that your plan includes hospitals, doctors, and specialists that you trust and regularly see.
  • What does the plan cover? Verify if the prescription drugs you take are included in the plan’s coverage, and compare other benefits offered.
  • What is the reputation of the insurance company? Look at consumer reviews and the financial health of the company to ensure reliability.

Choosing an individual health insurance plan requires careful consideration, but investing time and effort into the process will pay off when you and your family require care.

Frequently Asked Questions About Individual Health Insurance

  • Les Masterson contributed to this report.


  • Health Insurance Coverage of the Total Population
  • Are You Eligible to Use the Health Care Marketplace?
  • Health Care Rights and Protections
  • Learn More About the Affordable Care Act
  • Tips About the Health Insurance Marketplace
  • Enroll in or Change Coverage for 2022 with a Special Enrollment Period
  • See If You Can Get Health Coverage
  • Market Plan Selections by Metal Level
  • Understanding Short-Term Limited Duration Health Insurance
  • Three Ways Affordable Care Law Markets Have Evolved for Consumers

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