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How to Compare Health Plans by Total Yearly Cost

A repeatable way to compare health plans: a year of premiums plus out-of-pocket costs at low, expected and worst-case use, with a worked 2027 three-plan table.

By All Blog Article Editorial Team · Published · 9 min read

To compare health plans by total yearly cost, add twelve months of each plan's premium to what you would pay out of pocket for care, and do that sum three times: for a light year, the year you expect, and a worst-case year. The plan that costs least in the year you expect, without a worst case you could not afford, is often the better value, as long as your doctors and drugs are covered.

Comparing premiums alone leaves out a large part of the cost. HealthCare.gov advises comparing each plan's estimated total yearly cost, not just the premium, because deductibles, copayments and coinsurance can sometimes add more to a year's spending than the premium does.

The exercise is worth repeating every year. Marketplace open enrollment for 2027 coverage on HealthCare.gov runs from November 1, 2026 to January 15, 2027. KFF's review of rate filings from 276 insurers, updated August 3, 2026, found a median proposed premium increase of 15% for 2027. Those are proposed, not final, rates, but they mean last year's cheapest plan may not be this year's.

Key takeaways

  • Total yearly cost is twelve months of premiums plus what you pay for care: deductible, copays and coinsurance.
  • Price three scenarios for each plan. The worst case for in-network care is a year of premiums plus the plan's out-of-pocket maximum.
  • Low-premium, high-deductible plans tend to win light years. Plans with higher premiums and lower cost sharing win once your expected care passes a break-even point you can calculate.
  • A network or drug-coverage problem can overturn the arithmetic, because out-of-network care and services the plan does not cover do not count toward the out-of-pocket maximum.
  • Cost-sharing reductions on Silver plans and HSA eligibility on Bronze plans can change which plan comes out ahead, so run the numbers with them included if they apply to you.

The method in five steps

  1. Annual premium. Take each plan's monthly premium, after any premium tax credit if you buy through the Marketplace, and multiply by 12.
  2. Cost-sharing terms. For each plan, note the deductible, the copay or coinsurance for the services you use, and the out-of-pocket maximum. If any of these terms are unfamiliar, premium, deductible, copay and coinsurance explained defines them with an example.
  3. Three scenarios. Estimate your care for a low-use year, an expected year and a worst-case year.
  4. Price each scenario. Work out your out-of-pocket cost under each plan, stop at the plan's out-of-pocket maximum, then add the annual premium.
  5. Run the checks. Confirm your doctors are in network and your drugs are covered, then factor in cost-sharing reductions or an HSA if they apply.

Step 1: Build three scenarios

  • Low use: preventive care and one or two sick visits. This scenario shows what you pay mainly for protection.
  • Expected use: roughly what you used last year, adjusted for anything you already know about, such as a planned procedure, a pregnancy or a new long-term prescription. Last year's Explanation of Benefits statements show the allowed amount for each service you had, which is the figure to work from.
  • Worst case: a serious illness or injury. For in-network care this is easy to price, because your cost stops at the out-of-pocket maximum. For plan year 2027, a Marketplace plan's maximum can be no higher than $12,000 for self-only coverage or $24,000 for family coverage. A 2027 federal rule would have let individual-market Bronze plans set a higher maximum, but a federal court stayed that change on July 16, 2026 while the lawsuit continues, so it did not take effect as finalized.

HealthCare.gov's plan preview offers a shortcut: select "Add yearly cost" on a plan, choose low, medium or high expected use, and the site shows an estimated total yearly cost for each plan. Your actual costs will differ with the care you use, so treat it as a starting point and check it against your own scenarios.

Step 2: Price each scenario for each plan

Example: A single adult compares three illustrative 2027 plans. All figures are illustrative except the 2027 federal limit of $12,000, which every plan's maximum stays under. In all three plans, primary care visits work as shown in the table, and everything else goes to the deductible and then to coinsurance. Copays count toward the out-of-pocket maximum but not toward the deductible. All care is in network, and every care cost is the plan's allowed amount.

Plan featurePlan APlan BPlan C
Monthly premium$320$450$560
Premiums for the year$3,840$5,400$6,720
Deductible$7,000$4,000$1,000
Primary care visitFull allowed amount until the deductible is met$40 copay$25 copay
Coinsurance after the deductible40%30%20%
Out-of-pocket maximum$10,000$9,000$6,000

The three scenarios, priced at allowed amounts:

  • Low use ($500 of care): two primary care visits at $150 each and lab tests at $200.
  • Expected use ($6,000 of care): four primary care visits at $150 ($600), three specialist visits at $300 ($900), an MRI ($1,500) and an outpatient procedure ($3,000).
  • Worst case: enough in-network care to reach each plan's out-of-pocket maximum.
ScenarioPlan APlan BPlan C
Low use, out of pocket$500$280$250
Low use, total yearly cost$4,340$5,680$6,970
Expected use, out of pocket$6,000$4,580$1,980
Expected use, total yearly cost$9,840$9,980$8,700
Worst case, out of pocket$10,000$9,000$6,000
Worst case, total yearly cost$13,840$14,400$12,720

How the low-use and expected-use figures were reached:

  • Low use: Plan A applies all $500 to its deductible. Plan B charges two $40 copays ($80) plus the $200 of lab tests toward its deductible, for $280. Plan C charges two $25 copays ($50) plus the $200 of lab tests, for $250.
  • Expected use, Plan A: all $6,000 of care falls below the $7,000 deductible, so the enrollee pays all of it.
  • Expected use, Plan B: four primary care copays come to $160. The other $5,400 of care meets the $4,000 deductible, and 30% of the remaining $1,400 is $420. Out of pocket: $160 + $4,000 + $420 = $4,580.
  • Expected use, Plan C: four copays come to $100. The other $5,400 meets the $1,000 deductible, and 20% of the remaining $4,400 is $880. Out of pocket: $100 + $1,000 + $880 = $1,980.

Step 3: Read the results

Plan A, the lowest premium, is cheapest in the light year by $1,340 against Plan B and $2,630 against Plan C. Plan C, the highest premium, is cheapest in the expected year, by $1,140 against Plan A, and in the worst case, by $1,120 against Plan A. Plan B is not the cheapest in any scenario, and a plan that loses in every scenario can usually be set aside, unless one of the checks below changes its numbers.

Find the break-even point

The break-even point is the amount of care at which two plans cost the same for the year. For Plans A and C, leaving primary care visits aside, it is $4,600 of care at allowed prices:

  • Plan A: $3,840 in premiums + $4,600 under the deductible = $8,440.
  • Plan C: $6,720 in premiums + $1,000 deductible + 20% of the remaining $3,600 ($720) = $8,440.

The rule that follows: below the break-even amount of care, the lower-premium plan usually costs less over the year; above it, the plan with the higher premium and lower cost sharing usually does. When your expected care sits close to the break-even point, the worst-case row is a useful tiebreaker, because it shows how much protection each plan buys.

Step 4: Checks that can overturn the arithmetic

Your doctors and hospitals

The figures above assume all care is in network. Out-of-network care does not count toward the out-of-pocket maximum, so a plan that looks cheapest can become the most expensive if a doctor you rely on is outside its network. The guide to HMO, PPO, EPO and POS network types explains how each type treats out-of-network care. When you compare Marketplace plans, HealthCare.gov lets you select your doctors and facilities and then tells you whether each plan covers them in network.

Your prescriptions

Each Marketplace plan has a list of covered drugs, and HealthCare.gov lets you add your prescriptions when you compare plans and shows whether each plan covers them. Money spent on a drug the plan does not cover does not count toward the out-of-pocket maximum. If you take a regular medicine, add its yearly cost under each plan to your expected-use scenario. How to check a plan's drug coverage covers formularies and tiers.

Cost-sharing reductions

Income-based cost-sharing reductions are extra savings that lower deductibles and out-of-pocket maximums, and they come only with Silver Marketplace plans. For plan year 2027 they are available to eligible enrollees with household income from 100% to 250% of the federal poverty line. They cut the 2027 self-only out-of-pocket maximum to no more than $4,000 at incomes up to 200% of the poverty line, and to no more than $9,600 above 200% up to 250%. Marketplace savings for 2027 use the 2026 poverty guidelines, which put the line at $15,960 for one person (higher in Alaska and Hawaii), so 200% is $31,920 and 250% is $39,900. If your income falls in that range, re-run the table with the Silver plan's reduced figures, because they can change which plan is cheapest. When a Silver plan beats a Gold plan works through that case.

HSA eligibility

Under the 2025 tax law known as the One Big Beautiful Bill Act, any Bronze or catastrophic plan available as individual coverage through a Marketplace counts as an HSA-qualified high-deductible health plan for months from January 2026 onward; IRS Notice 2026-5 explains the rule. A health savings account (HSA) lets you set money aside for medical costs with tax advantages, up to yearly IRS limits that HSA rules for 2026 and 2027 lists. If you would actually fund an HSA, the tax saving narrows the gap between a high-deductible plan and a lower-deductible one in a heavy year. How much depends on your tax bracket, so treat it as a tiebreaker rather than the main reason to choose.

Job-based plans

The same method works for employer coverage. Multiply your share of the premium per paycheck by the number of paychecks in a year, then price the same three scenarios with each option's deductible, copays, coinsurance and out-of-pocket maximum.

Frequently asked questions

What counts as the worst case?

For in-network care, it is a year of premiums plus the plan's out-of-pocket maximum. Spending can go higher only through costs that do not count toward the maximum: out-of-network care, services the plan does not cover and charges above the plan's allowed amount.

Is the plan with the lowest premium usually the cheapest?

Only in years when you use little care. In the example above, the lowest-premium plan was cheapest in the light year but $1,140 more expensive than Plan C in the expected year. Compare total yearly cost at the level of care you actually expect.

Does HealthCare.gov calculate total yearly cost?

It gives an estimate. When previewing plans you can select "Add yearly cost" and choose low, medium or high expected use. The estimate reflects the level of use you pick, not your own bills, so check it against your own known costs, such as regular prescriptions or a planned procedure.

How can you estimate the care you will use?

Start from last year: your Explanation of Benefits statements show the allowed amount for each service. Add anything planned, such as surgery, a pregnancy or a new long-term prescription, and remove one-off costs that will not repeat.

Is it worth redoing the comparison every year?

Yes. Premiums, deductibles, networks and drug lists can all change from one plan year to the next, and the federal cap on out-of-pocket costs rose by about 13.2% from plan year 2026 to plan year 2027, so a plan that was cheapest last year may not be this year.

Sources

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