What Is Catastrophic Health Insurance?

Catastrophic health insurance plans come with the lowest monthly premiums and highest annual deductibles of any type of health coverage. They are exclusively available to young people and others who don’t have access to affordable health care coverage or are experiencing some other type of hardship. 

Keep reading to learn more about who qualifies for catastrophic health insurance and what services are typically covered.

On This Page

• 

  How Does Catastrophic Health Insurance Work?

• 

  What Does Catastrophic Health Insurance Cover?

• 

  How Much Does Catastrophic Health Insurance Cost?

• 

  How To Get Catastrophic Health Insurance

• 

  FAQs

How Does Catastrophic Health Insurance Work?

Catastrophic health insurance plans generally have lower premiums and higher deductibles than plans in the other health insurance tiers. As the name suggests, catastrophic plans are primarily used to protect against significant medical debt due to the sudden or unexpected onset of a severe health problem like a heart attack, cancer or injuries from a major accident.

In 2025, the deductible for catastrophic coverage will be $9,200 for individual plans and $18,400 for family plans.^[1]

These thresholds are exactly the same as the maximum out-of-pocket limits for Marketplace plans.^[2] This means that, while it will take significantly longer to reach the deductible for a catastrophic plan than for any other plan, you’ll never have to pay coinsurance after reaching it since the deductible and out-of-pocket maximum are the same.

Who Is Catastrophic Health Insurance Best For?

Catastrophic coverage is typically best for young, healthy people who expect to need little or no care throughout the year but want to secure cheap coverage in case of a worst-case scenario. Alternatively, it could be beneficial if your expected health care needs are so high that you know you will hit your out-of-pocket maximum no matter what type of plan you have, though these situations are more rare. Keep in mind that you generally shouldn’t opt for a catastrophic plan unless you have a significant amount of money in savings to cover your deductible.

You should also note that not everyone is eligible for catastrophic health insurance. This category of coverage is only broadly available to people under the age of 30, although older individuals may also be able to enroll in catastrophic plans if they qualify for affordability or hardship exemptions.^[3]

Affordability exemptions apply to people who don’t have access to a Marketplace or employer health insurance plan that costs less than 7.97% of their household income. Meanwhile, you may qualify for a temporary hardship exemption if you are experiencing a situation such as the following:^[3]

What Does Catastrophic Health Insurance Cover?

Just like other Health Insurance Marketplace plans, catastrophic health plans are required to cover the following 10 essential health benefits:^[4]

Catastrophic plans must also cover at least three visits with your primary care physician (PCP) before you meet your deductible for the year.^[5] However, cost sharing may apply to these PCP appointments. For example, AmeriHealth charges catastrophic plan members a $30 copay for each primary care visit prior to reaching their deductible.^[6]

What Isn’t Covered?

A catastrophic plan will generally have the same kinds of exclusions as any other health plan, potentially including services like these depending on where you live:^[7]

While most medical services aren’t explicitly excluded from coverage, you should remember that your insurance company won’t pay for the majority of these services within a given year until you have spent nearly $10,000 out of pocket on health care, meaning your medical expenses and prescription drugs will generally go uncovered except in extreme cases.

In addition, it’s important to keep in mind that, despite the fact that they have the highest deductibles of all health plans, catastrophic plans are not always compatible with health savings accounts (HSAs) like traditional high-deductible health plans (HDHPs) are.^[8]

How Much Does Catastrophic Health Insurance Cost?

Individual catastrophic health plans may cost as little as $200 per month, according to Ryan McEachron, the CEO of ISU Insurance Services ARMAC Agency. In comparison, it costs $364 per month on average for an individual to enroll in the cheapest available plan in the bronze tier, which is the second-cheapest category of health insurance.^[9]

That said, you should be aware that subsidies like cost-sharing reductions and premium tax credits cannot be applied to catastrophic plans, so it may be more cost-effective for you to opt for a bronze or silver health plan depending on your income.^[5][10]

How To Get Catastrophic Health Insurance

Since different health insurance companies have different underwriting methods, it can be helpful to compare quotes from multiple carriers before settling on a catastrophic health plan. Receiving quotes generally requires sharing a good bit of information like your ZIP code, age, household income and more.

To expedite the plan comparison process, consider shopping through an online marketplace platform like SmartFinancial. After you fill out a brief questionnaire, we’ll help you find plans in your area so you can see which insurer is prepared to offer you the best deal. Click here to start comparing health insurance quotes for free in as little as a few minutes.