Updated: December 1, 2025
Advertising & Editorial Disclosure
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 HMOs, PPOs, EPOs, and POS 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 cost less but have limits on which doctors you can see. You need to select a primary care doctor who coordinates all your care and provides referrals. Emergency care gets covered anywhere, but you pay for routine out-of-network visits.
PPOs let you see specialists without referrals and visit out-of-network providers for partial coverage. You get the widest provider access but pay higher premiums.
You should choose a PPO as your health plan if you travel often.
EPOs offer larger networks than HMOs without requiring referrals for specialists. You must stay in-network except for emergencies.
POS plans combine HMO referrals with PPO out-of-network options, but get complicated quickly. You'll pay the least with referrals, more without them, and the most outside the network.
You are eligible for Medicaid when your income is less than the established limits. Some states have expanded it to include people earning up to 138% of the federal poverty level.
Medicare covers people who are 65 and older or you can qualify if you have disabilities or kidney disease. Part A handles hospital bills (usually free), Part B covers doctor visits (monthly premiums) and Part D adds prescriptions.
Part C or Medicare Advantage plans bundle cost of all into one.
These plans require you to pay a minimum of $1,650 for a single person or $3,300 for families in deductibles before insurance cover starts. The payoff comes from pairing these plans along with Health Savings Accounts, which help you save pre-tax dollars.
These plans cover what your primary health insurance does not, as you can buy additional plans such as dental care, vision services, critical illness or extended hospital stays.
Short-term plans provide temporary cover for up to a year but usually do not include benefits like prescriptions, mental health services, and maternity care.
These plans also don't meet ACA requirements and may leave coverage gaps for essential health benefits.
Health sharing plans aren't insurance and provide no legal coverage guarantee. Faith-based organizations pool contributions to help pay medical bills, but you have zero protection if they fail or deny requests.
COBRA lets you keep employer benefits temporarily after job loss, divorce, or aging out of parents' plans. Depending on your circumstances, you'll pay full premiums plus 2% fees, lasting 18 to 36 months.
Few insurers offer indemnity plans today, making them nearly obsolete. These plans let you see any doctor without networks or referrals, but you pay upfront and wait for partial reimbursement based on "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 | 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 work better for budget-conscious families who rarely need specialists, offering lower monthly premiums with small networks requiring referrals. PPOs cost more but let you see any doctor without referrals, making them ideal for frequent travelers or people with preferred specialists you don't want to change. Learn more: HMO vs. PPO.
There are four main health insurance types (HMO, PPO, EPO, POS) plus government programs like Medicare and Medicaid. You can also opt for HDHPs paired with HSAs, short-term coverage, and supplemental insurance, which serve your specific needs.
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 works have been published on JAMA Network Open, Harvard Business Review blog, USA Today and RealClear Politics, 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.
