Short answer: catastrophic plans used to be sold only to people under 30 or with a hardship exemption. Since the 2026 plan year, CMS treats being priced out of the premium tax credit by your income as a hardship, which opened these plans to healthy buyers of any age above the subsidy line ($63,840 for one person for 2027). The 2027 benefit rule, final in May 2026, writes an income-based hardship exemption into regulation, so the option carries into 2027. The marketplace decides the exemption when you apply, so confirm it is granted before you count on it.
What a Catastrophic Plan Covers
- Preventive care at no cost, like every marketplace plan.
- At least three primary care visits a year before the deductible.
- Everything else only after the deductible, which is set at the year’s out-of-pocket ceiling. For 2027 that ceiling is $12,000 for one person, so the plan is built for the bad year, not the routine one.
Premiums are generally lower than for other marketplace plans. Since January 2026 catastrophic plans also count as HSA-eligible, so you can pair one with a health savings account and put up to $4,500 a year away for 2027.
Who It Fits
The buyer this change was made for: over 30, healthy, earning above the tax-credit line, with savings that could cover a large deductible. For that household the comparison is a full-price bronze plan against a catastrophic plan, and both carry the same $12,000 ceiling.
It does not fit anyone who can still get a premium tax credit. The credit applies to bronze, silver, gold and platinum plans, and HealthCare.gov’s own advice is that if you qualify for savings, a Bronze or Silver plan may be the better value. Below 400% of poverty, price the credited bronze plan first.
Above the line and rarely see a doctor?
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Catastrophic or Bronze: The Two Questions
- How much lower is the premium? Multiply the monthly difference by twelve. That is what the catastrophic plan saves you in a year when nothing happens.
- What does the bronze plan pay before $12,000? Many bronze plans cover some visits or generic drugs with a copay before the deductible. If you would use those, the bronze plan’s extra premium may come back to you.
How the Exemption Is Granted
For 2026, CMS said the HealthCare.gov application would check the income-based hardship automatically from the income you project, with the paper exemption form as the fallback. Off-exchange buyers could use the same exemption. The 2027 rule keeps the income test, which CMS describes as applying to people ineligible for the credit or for cost-sharing reductions because of projected income below 100% or above 250% of poverty. Plans and rules can differ in states that run their own marketplace.
Plans priced for people above the line are covered in more depth in the subsidy cliff explained and health insurance for high earners.
Sources
- CMS fact sheet, Consumers Gain Access to Catastrophic Health Insurance Plans for 2026 (September 4, 2025).
- CMS fact sheet, HHS Notice of Benefit and Payment Parameters for 2027 Final Rule: the income-based hardship exemption.
- HealthCare.gov, catastrophic health plans: who can buy and what is covered before the deductible.
- IRS, Notice 2026-5, Q&A-4: catastrophic plans treated as HSA-eligible.
- CMS, 2027 cost-sharing limits: the $12,000 ceiling.
- HHS, 2026 poverty guidelines: the $63,840 line.
Eligibility for a hardship exemption is decided by the marketplace, not by an agent. Private plans are medically underwritten, are not ACA plans and are not available in every state. Daniel Griffin is a licensed independent insurance agent, NPN #22052447, not tied to any single carrier and not affiliated with the U.S. government.