Affordable Health Insurance: How to Find Coverage That Fits Your Budget

Obtaining affordable health insurance means finding coverage that provides essential health benefits without going over your budget. While most Americans receive health insurance through their employers, millions of people — including self-employed workers, gig workers, and people whose employers don’t offer coverage — need to find their own plans.^[1]

If you’re not eligible for employer-sponsored health insurance, you can still find affordable coverage through government programs, marketplace plans with subsidies, or alternative options.

Here’s what you need to know about available affordable health insurance, eligibility requirements, and how to choose the best plan for your situation and budget.

What affordable health insurance means under the Affordable Care Act (ACA)

The Affordable Care Act, also known as Obamacare, makes health insurance more affordable for many Americans through premium tax credits and cost-sharing reductions for eligible households.

Premium tax credits reduce your monthly insurance premium based on your household income. Cost-sharing reductions lower your deductible, copayments, co-insurance, and out-of-pocket maximum if you choose a Silver plan.

The marketplace offers four tiers of coverage — Bronze, Silver, Gold, and Platinum. Bronze plans have the lowest premiums but also the highest out-of-pocket costs. Households earning between 100% and 400% of the federal poverty level qualify for premium tax credits, with larger subsidies available to people with lower incomes.^[2]

Here’s a look at what you could pay after subsidies and cost-sharing features based on your income:

Income Level (% of Federal Poverty Level)	Expected Contribution at Start of Range (% of Income)	Expected Contribution at Top of Range (% of Income)
Less than 150%	0%	0%
150%–200%	0%	2%
200%–250%	2%	4%
250%–300%	4%	6%
300%–400%	6%	8.5%
400% or higher	8.5%	8.5%

Who qualifies for affordable health insurance subsidies?

Subsidies can make marketplace plans more affordable for eligible Americans. To qualify for premium tax credits, your household income must fall between 100% and 400% of the federal poverty level.

For most states in 2025, that’s roughly $15,650–$62,600 for individuals and $32,150–$128,600 for a family of four.

Your modified adjusted gross income (MAGI) determines your income eligibility. MAGI includes your adjusted gross income (AGI) plus certain types of income. If your income changes during the year, you should report it promptly to the marketplace to avoid owing money back during tax season.

Cost-sharing reductions work differently from premium tax credits. These subsidies reduce your deductible, copayments, and co-insurance, but they’re only available with Silver plans and for households earning up to 250% of the federal poverty level.

Self-employed people, freelancers, and people without employer coverage may benefit significantly from these subsidies, as they can make comprehensive coverage much more affordable than paying full marketplace prices.

Who qualifies for Medicaid?

For starters, Medicaid differs from Medicare. Medicare primarily serves people 65 and older, as well as people with eligible disabilities or conditions. Medicaid provides health benefits to low-income individuals and families of all ages.

Medicaid qualification requirements include:

• Household income at or below 138% of the federal poverty level in expansion states

• U.S. citizenship or qualified immigrant status

• Residency in the state where you’re applying

• Meeting specific categorical requirements, such as pregnancy, disability, or age

Medicaid expansion has created different eligibility rules across states. In the 40 states plus Washington, D.C., that expanded Medicaid, adults can qualify based solely on income. In non-expansion states, adults typically need to meet additional criteria beyond income limits, such as having dependent children, being pregnant, or having a disability.

This difference significantly affects access to affordable coverage for low-income adults in those states.

Most affordable health insurance for young or healthy people

Young, generally healthy people typically face the lowest health insurance costs because they use fewer medical services and represent a lower risk to insurers.

Bronze plans and catastrophic plans offer the lowest premiums for healthy buyers, who primarily need preventive care. Bronze plans cover essential health benefits but have higher deductibles and out-of-pocket costs.^[3]

Catastrophic plans, available only to people younger than 30 or people with hardship exemptions, provide even lower premiums but very high deductibles. You’ll pay more when you need medical care beyond preventive services.

Network type also affects costs. Health maintenance organizations (HMOs) typically offer the lowest premiums because they require referrals for specialist care and have smaller provider networks. Preferred provider organizations (PPOs) and exclusive provider organizations (EPOs) cost more but offer greater flexibility.

Here’s a comparison of the three plan types:

	HMO	PPO	EPO
Main features	Primary care physician required, referrals for specialists	Direct specialist access, out-of-network coverage	Direct specialist access, in-network only
Pros	Lowest premiums, coordinated care	No referrals needed, broader coverage network	No referrals needed
Cons	Requires referrals; no out-of-network coverage except emergencies	Higher premiums and costs	No out-of-network coverage except emergencies
Best for	Budget-conscious people comfortable with primary care coordination	People wanting maximum flexibility and willing to pay more	People wanting flexibility within a defined network

Other options: Medicaid, CHIP, and short-term plans

Even if you don’t qualify for ACA subsidies, you still need health coverage to protect against unexpected medical expenses and ensure access to preventive care.

• Medicaid provides free or low-cost comprehensive coverage for low-income individuals and families, with eligibility based on income and state expansion status.

• The Children’s Health Insurance Program (CHIP) covers children — and in some states, pregnant women — in families earning too much for Medicaid but not enough to afford private insurance.

• Short-term insurance plans offer temporary coverage — up to four months — at lower premiums than marketplace plans. These plans don’t qualify for subsidies and provide limited coverage. They can also exclude pre-existing conditions, prescription drugs, and other essential health benefits, which can leave you with significant financial exposure if you develop health issues.

Let’s compare these three plan types:

	Medicaid	CHIP	Short-Term Plans
Benefits	Comprehensive coverage, low or no cost	Solid coverage for children	Temporary coverage, lower premiums
Eligibility	Income-based, varies by state	Children in moderate-income families	Anyone who needs temporary coverage
Pro	Very affordable	Low cost for kids	Lower cost
Con	Limited provider network	Adults not eligible	Many exclusions, including pre-existing conditions

How to choose health insurance that’s best for you

Finding the right affordable health insurance requires comparing multiple features beyond just premium costs. The health insurance marketplace and insurance companies offer various tools to help you evaluate your options and estimate total annual costs based on your expected healthcare usage.

Follow these steps to find your best plan:

1. Determine your eligibility for subsidies, Medicaid, or CHIP through the marketplace or state agencies.

2. Calculate your total costs, including premiums, deductibles, and out-of-pocket maximums.

3. Check provider networks to ensure your preferred doctors and hospitals are covered.

4. Review prescription coverage if you take regular medications.

5. Consider your health needs and choose a plan tier that balances premiums with potential out-of-pocket costs.

6. Compare insurers in your area for customer service ratings and claims processing.

The marketplace provides plan comparison tools and cost calculators that estimate your annual expenses.

How to save on affordable health insurance year-round

Health insurance remains a crucial protection against financial hardship from unexpected medical expenses, especially for self-employed people and gig workers who don’t have employer-based safety nets.

Beyond choosing the right insurance plan, you can reduce your healthcare costs throughout the year. Money-saving strategies include:

• 

  Report income changes promptly

  This can help you maintain accurate subsidy amounts and avoid repayment obligations.

• 

  Use preventive services

  Preventive services are generally covered at 100% and can help you catch health issues early before they become expensive.

• 

  Explore health savings accounts (HSAs)

  If you choose a high-deductible health plan, an HSA can provide some tax-advantaged healthcare savings.^[4]

• 

  Comparison shop

  Plan offerings, networks, and costs change annually, so it’s important to compare plans every year during open enrollment to ensure you’re still getting the right balance of coverage and cost.

Affordable health insurance FAQs