Who Qualifies for a Catastrophic Plan?
Understand the qualifications for catastrophic health insurance. Learn how these plans provide essential coverage for major medical events and how to apply.
A catastrophic health insurance plan is a type of health coverage designed primarily to protect individuals from the high costs associated with severe illnesses or injuries. These plans offer a financial safety net for unexpected and significant medical expenses. They are characterized by relatively low monthly premiums, making them an affordable option for some, but they come with a very high deductible that must be met before most medical services are covered.
Eligibility for a Catastrophic Plan
Eligibility for a catastrophic health plan is specifically defined by the Affordable Care Act (ACA). Generally, these plans are available to individuals who are under 30 years old. However, individuals of any age can qualify for a catastrophic plan if they receive an approved hardship exemption or an affordability exemption.
A hardship exemption can be granted for challenging life circumstances that prevent an individual from obtaining health coverage. Examples include homelessness, eviction, foreclosure, a utility shut-off notice, domestic violence, or the death of a family member. Filing for bankruptcy or incurring substantial medical debt can also qualify.
An affordability exemption applies if the lowest-priced health coverage option available through the Health Insurance Marketplace or an employer would cost more than a certain percentage of an individual’s household income. For 2025, this threshold is set at 7.28% of household income. To enroll in a catastrophic plan using an exemption, individuals must apply for and receive an Exemption Certificate Number (ECN).
Understanding Key Catastrophic Plan Features
Catastrophic plans are structured with a high deductible, meaning the policyholder pays for most healthcare services out-of-pocket until this deductible is met. For 2025, the annual deductible for an individual catastrophic plan is $9,200. Once this deductible is satisfied, the plan then covers 100% of the costs for in-network covered services for the remainder of the year.
Despite the high deductible, these plans cover essential health benefits as mandated by the ACA. This includes emergency care, hospitalization, and prescription drugs, which become covered after the deductible is reached.
Catastrophic plans also provide certain preventive services at no cost, even before the deductible is met. These include routine check-ups, screenings, and at least three primary care visits per year.
Catastrophic plans do not qualify for premium tax credits or cost-sharing reductions. This contrasts with other Marketplace plans, where eligible individuals can receive financial assistance to lower their monthly premiums or out-of-pocket costs. While premiums are low, the lack of subsidies means these plans may not always be the most economical option for those who would otherwise qualify for financial aid.
Enrolling in a Catastrophic Plan
Individuals who meet the eligibility criteria can enroll in a catastrophic health plan through the Health Insurance Marketplace, which includes healthcare.gov or state-specific marketplaces. The enrollment process begins by creating an account on the Marketplace website. This account serves as the portal for managing the application and selecting a plan.
After creating an account, applicants must complete a detailed application. This involves providing personal information, household size, and income details, used to verify eligibility for various plans.
For those over 30 seeking a catastrophic plan, their approved hardship or affordability exemption certificate number must be entered during this process. Once the application is submitted and eligibility is confirmed, individuals can compare available catastrophic plans and select the one that best suits their needs.