Having to think about replacing your employer-sponsored health coverage with an Individual & Family plan may seem daunting. But with a basic understanding of available plans, and some help from Alight Retiree Health Solutions, you can make informed decisions about coverage that works for your budget and health needs.

Since 2010, when the Affordable Care Act (ACA) was signed into law, individuals and families have been able to purchase health insurance through an exchange (sometimes called the Marketplace) operated by the federal or state government, or through a private exchange such as Alight.

Health plans are offered by insurance companies, which use your age, location, and other data to determine how much to charge. When you visit an exchange and enter your location, you’ll see a list of available plans to choose from. The coverage itself is standardized: All plans, at a minimum, cover the same basic services. What varies are the costs for each service and the specific doctors, hospitals, and other providers that participate in each plan. This allows an apples-to-apples comparison so you can select one that most closely matches your needs.

Pricing: The basics

Plans come with two broad types of costs. You pay a monthly premium to have the coverage available when you need it. And you pay a variety of other amounts, including coinsurance, copayments, and deductibles, to use your coverage. These are explained in more detail in Understanding Costs.

Coverage: The tiers

The most common plans fall into four categories (also called tiers) based on how the costs for your care are shared between you and your plan. The plan categories are labeled as Bronze, Silver, Gold, and Platinum. A Bronze plan covers the same basic services as a Platinum plan––the differences lie in the monthly premium, cost-sharing, and deductible.

As a simplified example, consider what you’d pay for a basic visit to a doctor who charges $100:

• A Bronze plan would pay $60 to your doctor, leaving you to pay the remaining $40
• A Silver plan would pay $70, you pay $30
• A Gold plan would pay $80, you pay $20
• A Platinum plan would pay $90, you pay $10

This example relies on a few basic assumptions: You’ve paid your monthly premiums and met your annual deductible; the doctor is in-network; and the $100 charge is within the plan’s parameters.¹

The same concept applies to any other covered service you might need, such as a lab test, a surgical procedure, a visit to a specialist. You’d pay the premium, deductible amount, and cost-sharing; the plan would pay the rest.

How the plans are structured

Health insurance plans in all four tiers are structured in a few different ways, which affects how you obtain and pay for health care. All plans have a network of doctors, hospitals, and other providers, which you’re encouraged to choose.

A few universal truths about plans that are available:

• You’ll always pay less to see an in-network provider than you’d pay to see an out-of-network provider.
• Most plans require you to designate a primary care physician, or PCP, to manage your care.
• Some plans require a referral from your PCP before you can visit an in-network specialist, therapist, or other practitioner.
• When considering any plan, look closely at the provider network to see if your existing providers are included.

In basic terms, here’s how the most common plan structures work :

• HMO (health maintenance organization): An HMO plan typically has lower premiums but less flexibility when choosing providers. Out-of-pocket costs are relatively low when you use in-network providers (doctors, hospitals, labs). With the exception of emergencies, out-of-network care is not covered at all, so you’ll pay the full cost. You also need to designate a PCP and get a referral before you see a specialist, therapist, or other provider.
• PPO (preferred provider organization): A PPO is usually more expensive than an HMO and gives you greater flexibility when choosing providers. You’ll typically pay higher premiums and out-of-pocket costs for in-network care than an HMO charges. While out-of-network care is covered, it costs you more than in-network care. No referral is needed to see specialists or other providers.
• POS (point of sale): POS plans are usually an expensive option because they provide the most flexibility. They typically charge higher premiums and out-of-pocket costs for in-network care. You don’t have to designate a PCP and don’t need a referral to see a specialist. You can use out-of-network providers—but will pay more if you do. Some POS plans require you to file claims for reimbursement instead of paying providers directly.
• EPO (exclusive provider organization): An EPO charges lower premiums but generally provides the least flexibility: You must always use in-network providers except in an emergency. Provider networks for EPOs may offer fewer choices than networks for other plan types. Though it’s always a good idea to designate a PCP, you’re not required to do so; referrals to specialists and other providers are not required, if you use providers in the plan’s network.
• HDHP (high-deductible health plan): An HDHP covers the same basic services as the other plans and typically comes with a lower monthly premium. But there’s a high deductible before your coverage kicks in. It’s intended to be coupled with a health savings account (HSA), which lets you set aside tax-advantaged funds earmarked for health care expenses. HDHPs are popular among younger people in generally good health.²

Still need guidance?

Health insurance can be complicated. If you need help, contact Alight. An Alight licensed Benefits Advisor can walk you through the details and help you choose a plan that works for your individual health care needs.

¹How to Choose a Health Insurance Plan
² Types of Health Insurance Plans