Worried About Health Insurance Costs? There May Be Cheaper Options — But With Trade-Offs

For the millions of Americans shopping for Affordable Care Act insurance, there’s still time to sign up for 2026. But premium increases and the expiration of enhanced tax subsidies have led to larger-than-expected costs.

Concerned buyers, wondering if there is anything they can do, consult insurance brokers or talk to representatives at ACA Marketplace call centers.

“We’re hearing from people with complex health conditions who don’t think they can survive if they don’t have access to medical care,” said Audrey Morse Gasteier, executive director of the Massachusetts Health Connector, that state’s insurance marketplace.

And some are considering exiting the ACA to find more affordable options. But this requires caution.

It appears increasingly unlikely that Congress will extend the enhanced subsidies before the end of the year. On Wednesday evening, the House passed a package of measures favored by conservatives that do not address subsidies and were widely considered dead upon arrival in the Senate. However, earlier Wednesday, four Republican Party moderates joined Democrats in signing a discharge petition to force a vote — likely in January — on a three-year extension. The Senate and President Donald Trump are also expected to approve the measure, but if it is extended, the subsidies could be applied retroactively.

Meanwhile, the deadline for choosing a health plan is fast approaching. The official end of open registration is January 15th for coverage beginning February 1st. In most states, it’s already too late to sign up for coverage starting January 1st.

Here are five considerations in the decision-making process:

1. Short-term plans: “You must be healthy”

Some ACA buyers might find themselves considering short-term insurance plans sold outside of government-run marketplaces — or referred to such plans by insurance brokers. Beware.

Short-term plans are just that: insurance originally designed as temporary coverage for situations like changing jobs or attending school. They can look a lot like traditional coverage, with deductibles, co-pays and participating networks of hospitals and doctors. Yet they are not ACA-compliant plans and are not available on official ACA marketplaces.

They are often less expensive than ACA plans. But they cover less. For example, unlike ACA plans, they can impose annual and lifetime caps on benefits. The vast majority do not cover maternity care. Some may not cover prescription drugs.

Short-term plans require applicants to complete a medical questionnaire, and insurers can exclude coverage or cancel a policy retroactively for people with pre-existing health conditions. In addition, depending on the terms of the specific plan, a person who develops a health problem during the coverage period may not be accepted for renewal.

Additionally, short-term plans are not required to cover care on the ACA’s Essential Benefits Checklist, such as preventive care, hospitalization, or emergency services.

The shortcomings of these plans, which critics say are sometimes marketed in misleading ways, have led Democrats to call them “junk insurance.” The Trump administration says they are suitable for some people and has sought to make them more widely available.

“We recommend it when it makes sense,” said Joshua Brooker, a Pennsylvania insurance broker. “But if you want to sign up for short-term coverage, you need to know which boxes aren’t checked.”

“They’re not for everyone. You have to be healthy,” said Ronnell Nolan, president and CEO of Health Agents of America, a trade group.

And they’re only available in 36 states, according to KFF, a nonprofit health information organization that includes KFF Health News. Some states, like California, ban them. Others impose strict restrictions.

2. Be wary of coverage that isn’t complete

There are other types of health coverage offered by commercial brokers or other organizations.

One, called an indemnity plan, is intended to supplement a traditional health insurance plan by paying deductibles or copayments.

These plans are also not required to follow the ACA’s coverage rules. Typically, they pay a fixed amount – say a few hundred dollars per day – for a hospital stay or a lesser amount for a doctor’s visit. Typically, these payments are less than the full costs and the policyholder pays the rest. They typically also require consumers to fill out medical forms indicating any pre-existing conditions.

Another type, a faith-based sharing plan, pools members’ money to cover their medical expenses. Plans are not required to maintain a specific amount of financial reserves and members are not guaranteed that plans will pay their health care expenses, according to the Commonwealth Fund, a foundation that supports health care research and health system improvement.

Sharing plans expanded beyond religious communities after the passage of the ACA. Like short-term plans, they cost less than ACA plans but also do not have to follow ACA rules.

They are not considered insurance and some have been accused of fraud by state regulators.

“Yes, it’s cheaper, and yes, it works for some people,” Nolan said. “But you need to understand what this plan does. This would be my last resort.”

3. Consider a “Bronze” or “Catastrophic” plan, but be aware of deductibles

For those who want to keep ACA plans, the lowest premiums are typically in categories labeled “catastrophic” or “bronze.”

Jessica Altman, executive director of California’s ACA exchange, said her state has noticed an uptick in enrollment in bronze-level plans. They have lower premiums but high annual deductibles – the amount a customer must spend before most coverage kicks in. Deductibles for Bronze plans average nearly $7,500 nationwide, according to KFF.

Another option, new for 2026, is expanded eligibility for catastrophic plans, which were previously limited to people under 30. As the name suggests, they are intended for people who want health insurance in case they suffer a catastrophic health problem, such as cancer or injuries from a car accident, and the plans can have deductibles as high as the ACA’s annual limit on out-of-pocket costs — $10,600 for an individual or $21,200 for a family.

But now, people who lose their subsidies due to the expiration of enhanced tax credits can also benefit from these plans. However, they may not be available in all regions.

Lauren Jenkins, a broker in Oklahoma, said some of her clients making less than $25,000 this year qualified for very low-cost or free packages thanks to the enhanced subsidies. Next year, however, their costs could reach $100 or more per month for a “silver” level plan, a level higher than the bronze plan.

So she shows them ironclad plans to reduce the monthly cost. “But they might have a $6,000, $7,000 or $10,000 deductible that they now have to pay,” Jenkins said. “For people who only make $25,000 a year, that would be detrimental.”

Bronze and Catastrophic plans can be linked to health savings accounts, which can be used to save money tax-free for medical expenses. They are more popular with higher income households.

4. Another plan may have lower premiums

It can pay to shop around. Some people may find a lower premium by switching to another plan, even one offered by the same insurer. There are also different levels of cover, from bronze to “platinum”, where premiums also vary. Brooker said that in some places, “gold” tier plans are less expensive than silver ones, although that seems counterintuitive.

Additionally, some people who run their own business but have only one employee may be eligible for a group plan rather than an individual policy. Sometimes these can be cheaper.

Not all states allow it, Nolan said. But, for example, Nolan said, she has a client whose only employee is his wife, so she’ll see if they can qualify for a group plan at lower rates.

“It might work for them,” she said.

ACA rates for small group plans (fewer than 50 employees) vary by region and are not always cheaper than individual coverage, Brooker said.

“The question of where rates are best is pretty general,” he said.

5. Other rules of the road

Insurance experts encourage people not to wait until the last minute to at least take preliminary steps. Buyers can go to the official federal or state marketplace website and complete or update an application with the required income and other information needed to determine what the 2026 plan year has in store for them.

For example, even without Congressional intervention, subsidies will not disappear entirely. They will be smaller, however, and there is an upper income limit – a threshold for households earning more than four times the poverty line, which rises to $62,600 for an individual and $84,600 for a couple for 2026.

When shopping, consumers should make sure they land on an official ACA website, as there are lookalikes that may not offer ACA-compliant plans. Healthcare.gov is the official federal website. From there, people can find websites serving all 20 states, plus the District of Columbia, that operate their own ACA exchanges.

Government sites can also direct consumers to licensed brokers and other advisors who can help them with an application.

And a reminder: Consumers must also pay their first monthly premium for coverage to take effect.