When you're shopping for health coverage, monthly cost is often one of the first things you notice. Some alternatives, such as health care sharing ministries, direct primary care memberships or subscription health programs, may appear to cost less each month than an Affordable Care Act (ACA) health plan.
However, lower monthly costs may come with trade-offs in coverage, financial protection and consumer safeguards. Before choosing an alternative, it is important to understand how it compares to ACA coverage and what could happen if you need medical care.
Quick answer: ACA coverage vs. alternatives
ACA health plans generally provide more comprehensive coverage and stronger consumer protections than alternative health coverage options. While some alternatives may offer lower monthly costs, they may not cover the same services or provide the same financial protection if you experience a serious illness, injury or hospitalization.
What is ACA coverage?
ACA health plans are regulated health insurance plans that must meet federal and state requirements. They are designed to help cover a wide range of health care needs and provide financial protection when unexpected medical expenses occur.
ACA plans typically include coverage for:
- Preventive care
- Prescription drugs
- Emergency care
- Hospital care
- Mental health care
- Maternity and newborn care
- Coverage for pre-existing conditions
ACA plans also include an annual out-of-pocket maximum. This is the most you'll pay for covered services during a plan year. Once you reach that limit, your health plan pays 100% of covered services for the remainder of the year.
What are some alternatives to ACA coverage?
You may come across options that are marketed as alternatives to traditional health insurance.
Healthcare sharing ministries
Healthcare sharing ministries, sometimes referred to by brand names such as Medi-Share,® are membership-based organizations where participants voluntarily share eligible medical expenses. These programs are not health insurance and may operate under different rules than ACA-compliant health plans.
Direct primary care memberships
Direct primary care memberships allow members to pay a recurring fee directly to a physician for certain routine primary care services. While these memberships can help with everyday care, they typically do not cover hospitalization, surgery, emergency care or other major medical expenses.
Subscription health programs
Subscription health programs may offer services such as virtual care, wellness support or limited medical services for a monthly fee. The services included vary by program.
Going without coverage
Some people consider remaining uninsured to avoid monthly costs. However, paying entirely out of pocket for medical care can create significant financial risk if unexpected health needs arise.
ACA coverage and alternatives: What to compare
While each program is different, comparing a few common features can help you understand how ACA coverage may differ from some alternative options.
| Feature | ACA coverage | Some alternatives* |
|---|---|---|
| Coverage for pre-existing conditions | May vary or be limited | |
| Preventive care | May vary | |
| Prescription drug coverage | May vary | |
| Emergency and hospital care | May vary | |
| Mental health care | May vary | |
| Out-of-pocket maximum | May not apply | |
| Financial protection for major medical events | May be limited | |
| Federal and state insurance protections | May not apply |
*Coverage, eligibility requirements, payment methods and legal protections vary by program.
Why do some alternatives cost less?
Alternative options may have lower monthly costs because they do not always provide the same level of coverage, benefits or financial protections required of ACA-compliant health plans.
When comparing coverage options, it is important to evaluate:
- Monthly costs
- Deductibles and other out-of-pocket expenses
- Covered services
- Coverage limitations
- Financial protection if you experience a major medical event
A lower monthly payment does not always mean lower overall healthcare costs.
Think about what happens if your health needs change
If you're generally healthy, a lower-cost option may seem appealing. It's also important to consider what could happen if your situation changes unexpectedly.
Ask yourself:
- What if you need emergency care?
- What if you are hospitalized?
- What if you need surgery?
- What if you start taking an expensive prescription?
- What if you are diagnosed with an ongoing condition?
ACA plans are designed to help cover both routine and unexpected medical needs. Some alternatives may provide more limited support or have restrictions on what services are eligible for payment.
Don't forget about financial assistance
If cost is your primary concern, it's worth checking whether you qualify for financial assistance.
Depending on your household size and income, you may qualify for premium tax credits or cost-sharing reductions that can help lower your monthly ACA premium and reduce your out-of-pocket costs when you receive care. Many individuals and families pay less than the full premium because of these savings. When you get a quote for a MyPriority plan, we'll check if you qualify for financial assistance.
Questions to ask before choosing an alternative
Before enrolling, review the details carefully. Understanding the answers can help you make a more informed decision. Consider asking: