Updated: June 10, 2026
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The main types of health insurance include HMOs, PPOs, EPOs and POS plans, each balancing cost against provider freedom.
Medicare and Medicaid provide coverage for seniors and low-income individuals meeting eligibility requirements.
High-deductible, short-term and supplemental insurance types serve specific needs like tax savings or temporary coverage gaps.
The best health insurance depends on your doctor preferences, travel habits, employment type and monthly budget.
People choose between HMO, PPO, POS and EPO plans, which differ mainly in how much freedom you have to see doctors outside your network.
You can get coverage through government programs like Medicare and Medicaid, or temporary coverage for specific situations.
HMOs have lower premiums than most plan types but limit which doctors you can see. You choose a primary care doctor who coordinates your care and issues referrals to specialists. Emergency care is covered anywhere, but routine out-of-network visits are not.
PPOs let you see specialists without referrals and visit out-of-network providers for partial coverage. That broader access comes with higher premiums. Frequent travelers benefit most from a PPO because coverage follows them across provider networks.
EPOs have larger networks than HMOs and don't require referrals for specialists. Coverage is in-network only, with the exception of emergencies.
POS plans mix the HMO referral model with PPO out-of-network access, which adds complexity. Costs are lowest with referrals, higher without them and highest outside the network.
Medicaid covers people whose income falls below established limits. Some states have expanded eligibility to include people earning up to 138% of the federal poverty level.
Medicare covers people 65 and older, plus those with qualifying disabilities or kidney disease. Part A covers hospital bills and is free for most enrollees. Part B covers doctor visits for a monthly premium and Part D adds prescription coverage. Medicare Advantage (Part C) bundles all three into a single plan.
HDHPs require a minimum deductible of $1,650 for individuals or $3,300 for families before coverage kicks in. The tradeoff is eligibility for a Health Savings Account, which lets you set aside pre-tax dollars for medical costs, or a Flexible Spending Account (FSA).
Supplemental plans fill gaps in your primary coverage. Common options include dental, vision, critical illness and extended hospital stay coverage.
Short-term plans cover up to a year but typically exclude prescriptions, mental health services and maternity care. They don't meet ACA requirements, which means they can leave gaps in essential health benefits.
Health sharing plans aren't insurance and they don't carry a legal coverage guarantee. Faith-based organizations pool member contributions to help pay medical bills. If the organization fails or denies a request, you have no recourse.
COBRA lets you keep employer-sponsored coverage temporarily after a job loss, divorce or aging off a parent's plan. You pay the full premium plus a 2% administrative fee. Coverage lasts 18 to 36 months depending on the qualifying event.
Indemnity plans are rare today. They let you see any doctor without network restrictions or referrals. You pay the full cost upfront and get partial reimbursement later based on what the insurer considers "usual and customary" charges.
The best health insurance for you depends on your lifestyle, work situation and healthcare needs. Your doctor preferences, travel habits and employment type shape which coverage works best, while your budget determines what you can afford beyond monthly premiums.
The table below can help you understand which health insurance you should get based on your situation.
Rarely see doctors | HMO | Lowest premiums, though you'll need referrals for specialists |
Have preferred specialists | PPO | See any doctor without referrals, but pay higher premiums |
Travel frequently for work or leisure | PPO or POS | Out-of-state care coverage better than HMOs |
Self-employed or freelancers | PPO | PPOs are the best health insurance for self-employed people, offering direct specialist access when tight project deadlines make referral scheduling difficult. |
Gig workers with variable income | HDHP with HSA | Adjust contributions during lean months while building tax-free medical savings |
Contractors between projects | Short-term | Bridges coverage gaps (but won't cover pre-existing conditions) |
Recently lost your job | COBRA | Keep employer benefits temporarily while searching for new coverage. |
EPO | Comprehensive coverage with manageable costs until Medicare | |
Young adults off parents' plans | HMO | Affordable health insurance with referrals |
Need dental or vision coverage | Supplemental | Adds coverage your main insurance won't touch |
Faith-based cost sharing preferred | Health Sharing | Not insurance, but pools contributions (no coverage guarantee) |
The right amount of health insurance balances your health risks with what you can afford. Start by calculating your worst-case medical scenario, then work backward to find coverage that protects you financially without breaking your monthly budget.
Follow these steps to determine your coverage needs:
If you have 3-6 months of expenses saved, you can handle higher deductibles than someone living paycheck to paycheck. Match your deductible to what you can actually afford to pay.
Track how often you see physicians, specialists and urgent care. If you visit a doctor monthly, you need lower copays than someone who hasn't seen a doctor in years.
Add up monthly medication expenses. If you take regular prescriptions, prioritize plans with good drug coverage over those with low premiums but high medication costs.
If diabetes, heart disease or cancer runs in your family, choose plans with lower out-of-pocket maximums since you're more likely to need significant care.
Let's assume that Plan A's $500 monthly premium ($6,000/year) + $2,000 deductible = $8,000 total if the deductible is met. Plan B's $300 monthly premium ($3,600/year) + $6,000 deductible = $9,600 total if the deductible is met. The expensive plan, Plan A, saves $1,600 in the worst-case scenario, while the cheaper plan works better for healthy years with minimal care.
Young adults and college students can choose HDHPs with HSAs to save for future medical needs. Families with children need lower deductibles for frequent pediatric visits. People over 50 should prepare for increasing health care needs.
Health insurance types range from budget-friendly HMOs that limit provider choice to flexible PPOs that cost more. Government programs such as Medicare and Medicaid provide for specific populations based on age, disability or income. Your best choice depends on your needs. You should factor in deductibles, copays and out-of-pocket maximums alongside monthly premiums to understand your health care costs.
MoneyGeek addresses frequently asked questions about the different types of health insurance to help you understand coverage options and costs:
HMOs cost less and suit people who rarely need specialists, but care goes through a primary doctor and referrals are required. PPOs let you see any doctor without a referral and cost more. They're the stronger choice for frequent travelers or anyone with established specialist relationships they don't want to lose.
Full comparison: HMO vs. PPO.
Four plan types form the core: HMO, PPO, EPO and POS. Government programs (Medicare and Medicaid) sit alongside those. HDHPs paired with HSAs, short-term coverage and supplemental plans fill specific gaps depending on your situation.
You can only change or switch plans during open enrollment unless you have a special qualifying event, such as job loss, marriage, divorce, or having a baby. COBRA gives you 60 days to elect continuation coverage after job loss. Otherwise, wait for November's open enrollment for January coverage.
You can get health insurance through your employer, government marketplaces, directly from insurers, or government programs if you qualify. Your options depend on your employment status, income, age and state of residence. Most Americans get coverage through work, but individual markets and public programs fill the gaps.
About Deb Gordon
Deb Gordon, the co-founder and CEO of Umbra Health Advocacy, has held executive roles in health insurance and health care technology services. She authored a book titled “The Health Care Consumer’s Manifesto,” based on her research as a senior fellow at Harvard Kennedy School’s Mossavar-Rahmani Center for Business and Government. Her work has been published in JAMA Network Open, the Harvard Business Review blog, USA Today and RealClearPolitics, among others.
Gordon is an Aspen Institute Health Innovators Fellow and an Eisenhower Fellow. She was a 2011 Boston Business Journal 40 Under 40 honoree and a volunteer at MIT’s Delta V start-up accelerator, the Fierce Healthcare Innovation Awards. She earned her bioethics degree from Brown University and her MBA with distinction from Harvard Business School.
