Everything You Need to Know About Catastrophic Plans

What Are Catastrophic Plans?

A Catastrophic plan is a type of Affordable Care Act (ACA) health insurance plan that is designed to protect someone from very high, unexpected medical bills—think catastrophic life events like severe injuries and major illnesses that require hospitalization.

These plans provide lower monthly premiums in exchange for a very high deductible. These plans must cover preventive services, as well as three primary care visits each year before the deductible applies.

For Catastrophic plans, the out-of-pocket maximum is the same as the deductible. This means that you won’t have to pay any more out-of-pocket costs once you have paid your deductible. 

These plans are recommended for people who are generally healthy and want coverage mainly for worst-case scenarios.

Can Anyone Purchase a Catastrophic Plan?

Not everyone can enroll in a Catastrophic plan. There are two main ways to 

Age-based eligibility: Anyone under the age of 30 can purchase a Catastrophic plan without any additional documentation.

Exemption Eligibility: Anyone 30 or older needs to qualify for a special exemption to enroll in a Catastrophic plan.  These include:

Affordability Exemption: 

People who can’t find a health plan that costs less than a certain percentage of their income can qualify for an exemption.

Hardship exemption: 

People who have experienced difficult life events such as job loss, eviction, bankruptcy, or natural disasters can qualify for a Catastrophic plan.  Starting with 2026 health plans, this was expanded to include people whose incomes disqualify them from financial assistance but otherwise couldn’t afford health insurance.

Beginning in 2026, you may qualify for a hardship exemption if:

• You do not qualify for financial help like premium tax credits
• The lowest-cost plan (that isn’t a Catastrophic plan) on the Marketplace is still too expensive

In 2026, people with household incomes between 100% and 400% of the Federal Poverty Level who would normally be eligible for premium tax credits can now enroll in Catastrophic plans with a hardship exemption, as well as people who make over 400% of the Federal Poverty Level (approximately $128,000 for a family of 4), who do not qualify for financial help.

Note: Premium tax credit subsidies cannot be used to purchase catastrophic plans.

How Do I Submit An Exemption?

If you think you qualify for an exemption, you must submit an application through the ACA Marketplace and receive an Exemption Certificate Number (ECN) before enrolling in the catastrophic plan. 

FAQ Section for Quoting & Comparing Plans

Q: What are Catastrophic plans?

A: They are ACA-compliant individual market plans with lower premiums but very high deductibles, designed to protect against major medical events.

Q: Can anyone purchase a Catastrophic plan?

A: No. You must be under 30, or age 30+ and qualify for an exemption (hardship or affordability). Subsidies don’t apply.

Q: How do people qualify for “an exemption” to purchase a Catastrophic plan?

A: They must apply for either a hardship or affordability exemption through the Marketplace, receive an ECN, and then enroll in the catastrophic plan.