What Is a Qualified Health Plan (QHP)?
Unpack the core elements of a Qualified Health Plan (QHP), understanding its structure and significance for your health coverage.
A Qualified Health Plan (QHP) is a health insurance policy adhering to specific Affordable Care Act (ACA) requirements. These plans provide comprehensive coverage and consumer protections, making health insurance more accessible and transparent. They offer standardized benefits and cost-sharing limits, allowing for easier comparison. QHPs are a fundamental component of the health insurance landscape for many Americans seeking coverage outside of employer-sponsored plans.
Understanding Qualified Health Plans
A QHP meets comprehensive standards established under the Affordable Care Act. A primary requirement is coverage of ten “Essential Health Benefits” (EHBs): ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, prescription drugs, rehabilitative and habilitative services and devices, laboratory services, preventive and wellness services, chronic disease management, and pediatric services, including oral and vision care.
QHPs must comply with federally mandated annual limits on out-of-pocket costs, including deductibles, copayments, and coinsurance. For 2025, the out-of-pocket maximum is $9,200 for self-only coverage and $18,400 for family coverage. QHPs are prohibited from imposing annual or lifetime limits on essential health benefits.
QHPs also cover pre-existing conditions without exclusion; insurers cannot deny coverage, charge more, or limit benefits due to prior health issues. QHPs must offer a minimum level of coverage, known as actuarial value, and are categorized into metal tiers: Bronze, Silver, Gold, and Platinum.
These metal tiers indicate the average percentage of healthcare costs a plan covers: Bronze (60%), Silver (70%), Gold (80%), and Platinum (90%). Bronze plans typically have lower monthly premiums but higher out-of-pocket costs. Platinum plans have higher premiums but lower out-of-pocket expenses.
QHPs and the Health Insurance Marketplace
Qualified Health Plans are primarily accessible through the Health Insurance Marketplace, or exchange, a platform for individuals, families, and small businesses to shop for health coverage. This includes HealthCare.gov and state-run marketplaces. The Marketplace streamlines health plan comparison by presenting standardized information on benefits, costs, and provider networks.
For a health plan to be offered on the Marketplace, it must undergo a rigorous certification and approval process by state and federal regulators. This annual certification ensures plans meet all ACA requirements, including essential health benefits and cost-sharing limits. The Centers for Medicare & Medicaid Services (CMS) oversees this process for federally facilitated exchanges. States with their own marketplaces have specific certification timelines and requirements.
While all plans sold on official Marketplace websites are QHPs, not all health plans sold outside the Marketplace are. Many insurers offer off-Marketplace plans directly to consumers; these may meet some ACA standards but lack Marketplace certification. Consumers must purchase a plan through the Marketplace to ensure it is a certified QHP and to access financial assistance.
Eligibility for Financial Assistance
Purchasing a Qualified Health Plan through the official Health Insurance Marketplace links to eligibility for specific financial assistance programs. These include Premium Tax Credits (PTCs) and Cost-Sharing Reductions (CSRs). This assistance is exclusively available for QHPs obtained via the Marketplace and cannot be applied to plans purchased directly from an insurer.
Premium Tax Credits are government subsidies that reduce the monthly premium for health insurance. Eligibility is primarily determined by household income relative to the federal poverty level, typically between 100% and 400%. The credit amount is based on a sliding scale, with lower incomes receiving greater assistance. Other criteria include not having access to affordable employer-sponsored health coverage and maintaining lawful U.S. residency.
Cost-Sharing Reductions (CSRs) are financial aid that lowers out-of-pocket expenses like deductibles, copayments, and coinsurance. Unlike Premium Tax Credits, CSRs are only available for individuals who enroll in a Silver-tier QHP through the Marketplace. Eligibility for CSRs is income-based, generally targeting incomes between 100% and 250% of the federal poverty level. These reductions effectively increase a Silver plan’s actuarial value, leading to lower out-of-pocket costs.