Q. I have read that the Gold plans sold in the exchanges offer more generous coverage. What exactly does a Gold plan cover that isn’t covered by Bronze or Silver plans?
A. All individual/family and small group major medical plans (whether Bronze, Silver, Gold, or Platinum) issued since 2014 must cover the same essential health benefits, including free preventive care, so they all provide comprehensive coverage. This applies both inside and outside the exchanges.
But plans with the lowest premiums (Bronze, and to a lesser degree, Silver) require you to pay a larger share of your health costs. This typically means that your co-pays and deductibles will be higher, and your maximum out-of-pocket will generally be higher as well.
In 2024, all plans must have maximum out-of-pocket limits that don’t exceed $9,450 for an individual, or $18,900 for a family. These upper limits will decrease – for the first time – to $9,200 and $18,400 in 2025.1). But plans can have lower out-of-pocket limits, and that’s typically what you’ll see with Gold and Platinum plans. (Note that in many areas, Platinum plans are not available in the individual market.)
How does actuarial value work?
The distinction between the metal levels (Bronze, Silver, Gold, and Platinum) is based on the actuarial value (AV) of the plan. AV is calculated based on the average percentage of medical costs that the plan would pay, across all a standard population. That includes some enrollees who have barely any medical costs, as well as others who may run up millions of dollars in spending.
In the case of policyholders with very high claims, the insurance company is paying a huge percentage of their costs, since the bulk of the claim would be above the patient’s maximum out-of-pocket limit. But for insureds who have very low claims costs, the insured might be paying all or nearly all of the bill if the total cost is less than the deductible. So you can’t look at AV from an individual basis; it’s spread across a plan’s entire pool of insureds.
A Bronze plan has an AV of roughly 60%, which means that the insurance company pays 60% of their insureds’ average costs. A Silver plan has an AV of roughly 70% (or higher if the person qualifies for cost-sharing reductions (CSR) discussed below), a Gold plan has an AV of roughly 80%, and a Platinum plan has an AV of roughly 90%.
Within those constraints, the actual plan design can vary considerably, so it’s possible to find a Gold plan that has a higher deductible than a Silver plan. But you can expect that your overall out-of-pocket costs throughout the year will generally be lower with a plan that’s higher up the metal level scale, unless you qualify for CSR and pick a Silver plan. (You’ll need to consider total costs when you’re comparing plans, however, which includes the amount you’ll need to pay in monthly premiums.)
In most cases, Gold plans will have deductibles, copays, and prescription costs that are lower than Bronze or standard (non-CSR) Silver plans. But again, it’s important to carefully compare each option, because the plans vary significantly from one carrier to another and from one region to another.
Cost-sharing subsidies can make Silver better than Gold
If you qualify for cost-sharing subsidies (meaning your income doesn’t exceed 250% of the federal poverty level, or FPL) pay particular attention to the Silver plans. The cost-sharing subsidies are baked into Silver plans for eligible enrollees, and they result in coverage that’s got higher AV than a typical Silver plan — and often higher than a Gold or Platinum plan, depending on the person’s income.
People who enroll in plans with cost-sharing subsidies end up with lower maximum out-of-pocket than the general limits that apply to other ACA-compliant plans, and often lower copays and deductibles as well. In many cases, cost-sharing subsidies result in Silver plans that are more robust than Gold plans. Depending on household income, these plans can even end up with AV that’s higher than Platinum plans.
(There are three different levels of CSR. Eligibility for each level depends on the applicant’s income. So a person with an income of 145% of the poverty level will qualify for much more robust CSR benefits than a person with an income of 245% of FPL.)
But Gold plans are less expensive than Silver plans in some areas
Prior to 2018, pricing on individual-market health plans tended to be fairly straightforward, with Bronze plans having the lowest premiums, Silver plans having mid-range premiums, and Gold (or Platinum, in areas where they were available) plans having the highest premiums. But in the fall of 2017, the Trump administration stopped reimbursing insurers for the cost of cost-sharing subsidies. As a result, insurers began adding that cost to the premiums for Silver plans since cost-sharing subsidies are only available on Silver plans.
That resulted in disproportionately high prices for Silver plans, and much larger premium subsidies (since those are based on the cost of the benchmark Silver plan in each area). And in some places, Gold plans are less expensive than Silver plans.
Some states have implemented pricing rules for Marketplace insurers that require Silver-level plans to be priced higher than Gold-level plans (before premium subsidies are applied). This is because the vast majority of Silver-plan enrollees are receiving strong CSR benefits, meaning that the coverage is better than a regular Gold plan, and regulators are thus requiring the pricing to reflect that.2
The details vary by state. But regardless of where you live, it pays to closely compare your options and keep in mind that the pricing might not be what you’d logically expect.
Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org.
Footnotes
- ”Premium Adjustment Percentage, Maximum Annual Limitation on Cost Sharing, Reduced Maximum Annual Limitation on Cost Sharing, and Required Contribution Percentage for the 2025 Benefit Year” Centers for Medicare & Medicaid Services. November 15, 2023. ⤶
- ”In New Jersey’s ACA marketplace, a “premium alignment” bill would turn gold plan pricing on its head” XPostFactoid. June 16, 2023 ⤶
