Health Insurance

Best Cheap Health Insurance in Alabama 2021

Best Cheap Health Insurance in Alabama 2021

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In Alabama, affordable health insurance can be found on the state marketplace. We examined all the health insurance plans in Alabama and discovered that in the majority of counties, the Blue Cross Select Silver was the cheapest Silver health plan.

For 2021, the average monthly cost of health insurance in Alabama is $550 for a 40-year-old — an increase of nearly 13% from the 2020 plan year.

Although there are two insurers available on the state exchange, Blue Cross and Blue Shield of Alabama consistently provided the best prices on plans across all coverage tiers. But as you compare health insurance policies with different levels of coverage, the best plan for you may be different from the cheapest plan in terms of premiums, as cost sharing and benefits vary.

Cheapest health insurance by metal tier

We compared health insurance policies in Alabama by metal tier to find the most affordable plans for different levels of coverage. The rates may change by county, but the table below provides a good starting point in comparing the costs and benefits you may expect from a given metal tier. It shows the minimum monthly rate you can expect out of each tier of coverage and the deductibles you may expect from the plan.

Metal tier
Cheapest plan
Deductible
Maximum out of pocket
Monthly cost for a 40-year-old
Expanded BronzeBlue HSA Bronze$7,000$7,000$371
SilverBlue Cross Select Silver$3,700$8,150$509
GoldBlue Cross Select Gold$850$6,000$620
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Alabama cheapest health insurance

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In addition to metal tier and the policy you choose, your age also affects the actual cost of a health insurance plan. As you get older, health insurance premiums across all metal tiers increase. For example, a 60-year-old would pay $761 more a month than a 40-year-old for a Gold plan in Alabama. But if you have a Silver plan, you would pay $638 more on average as a 60-year-old.

Learn how we conducted this analysis in our: Methodology

Finding the best health insurance coverage in Alabama

The best health insurance plan in Alabama will depend on the county you live in, as this determines which policies are available. It's also based in part on your income, as low-income households may qualify for cost-sharing reductions (CSR), also known as subsidies. No matter where you live, you will be able to choose from different metal tiers that offer varying levels of coverage and rates to fit your financial situation.

Gold and Silver plans typically charge higher monthly premiums. However, they charge lower out-of-pocket expenses, such as deductibles, copays and coinsurance, than Bronze and Expanded Bronze plans. People who expect to use their health insurance often for recurring medical costs may be better off choosing a higher metal tier policy. However, if you're young and healthy, you would likely save money by choosing a lower metal tier plan.

Gold plans: Best for high expected medical costs

The highest metal tier available in Alabama, Gold plans can be the best for those who expect to use their insurance often. These typically cover the most out-of-pocket costs, which means you'll pay lower deductibles, copays and coinsurance. They’re best for those who expect to incur high medical expenses from chronic conditions or people who have costly prescriptions. On average, you can expect a Gold plan to cover roughly 80% of your health care expenses while you pay the other 20%.

Silver plans: Best for those with low income or average medical costs

Silver policies offer a middle ground between Gold and Bronze plans. In Alabama, Silver plan premiums are 9% cheaper than Gold plans on average, but they're 52% more expensive than Bronze plans. Silver plans provide a good balance between affordable monthly premiums and out-of-pocket costs, but they stand out due to their cost-sharing reduction (CSR) subsidies. If you are part of a low-income household, you may qualify for subsidies with a Silver health plan, which would further lower your out-of-pocket expenses. Typical Silver plans cover about 70% of your health care costs while you pay 30%. But with subsidies, you could qualify for a Silver plan that covers up to 94% of your health care costs.

Bronze and Expanded Bronze plans: Best for young, healthy people

Low monthly rates are available under Bronze plans, but they also offer the least coverage. Bronze plans are open to everyone, but they offer lower monthly premiums than higher metal tier plans. The lower monthly rates mean reduced coverage and higher out-of-pocket costs. So if you need medical care during the year, you would have to pay more money out of pocket before coverage kicks in. On average, you can expect a Bronze plan to cover about 60% of your health costs while you pay for the other 40%.

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Health insurance rate changes in Alabama

Health insurance rates, deductibles and out-of-pocket maximums are set on an annual basis by the health insurance providers. The rate changes are then sent to the federal exchange for approval before being offered during open enrollment.

For 2021, Bronze metal plans saw the largest increase in rates — rising over 12% since 2020 in Alabama.

Metal tier
2020 premium
2021 premium
% Change
Expanded Bronze$386$4065.18%
Silver$533$5676.43%
Gold$643$6775.31%

2020 and 2021 premiums are for a 40-year-old adult.

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Short-term health insurance in Alabama

In Alabama, residents can purchase short-term health insurance through private health insurers at any point during the year. The state follows federal guidelines, so coverage is limited to one year and can be renewed up to 36 months.

Short-term health insurance does not cover the essential health benefits — such as maternity care, mental health services and prescription drugs — like qualified Obamacare plans do. For this reason, you should carefully evaluate the policy against your health care needs before purchasing. Furthermore, you will be required to complete a medical exam before buying a policy, and you may be denied coverage due to pre-existing conditions.

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Best cheap health insurance companies in Alabama

There are two health insurance companies on the Alabama state exchange: Blue Cross and Blue Shield of Alabama and Bright Health Insurance Company. However, you will only be able to get Bright Health Insurance Company if you live in one of four counties (Chilton, Jefferson, Shelby and Walker), whereas Blue Cross and Blue Shield is available throughout the state.

Cheapest health insurance plan by county

Although coverage through the Alabama health insurance marketplace varies by county, Blue Cross Select Silver was the cheapest Silver plan in each region. Below, the table shows sample monthly premiums for the Blue Cross Select Silver Plan based on the number of people covered. Depending on the county, the same health plan may have different rates. For example, a 40-year-old can expect to pay a monthly premium of $452 in Greene County for the Blue Cross Select Silver policy, but for the same person it would cost $502 in Birmingham, which is in Jefferson County.

County
Cheapest plan
Age 40
Couple, age 40
Couple, age 40 + child

Autauga

Blue Cross Select Silver$492$1,177$829
BaldwinBlue Cross Select Silver$477$1,141$804
BarbourBlue Cross Select Silver$477$1,141$804
BibbBlue Cross Select Silver$502$1,201$846
BlountBlue Cross Select Silver$502$1,201$846
BullockBlue Cross Select Silver$477$1,141$804
ButlerBlue Cross Select Silver$477$1,141$804
CalhounBlue Cross Select Silver$467$1,117$787
ChambersBlue Cross Select Silver$477$1,141$804
CherokeeBlue Cross Select Silver$477$1,141$804
ChiltonBlue Cross Select Silver$502$1,201$846
ChoctawBlue Cross Select Silver$477$1,141$804
Show All Rows
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Average cost of health insurance by family size in Alabama

Beyond the metal tier and the ages of your family members, your family's size will also affect the monthly rates for your health insurance policy. In Alabama, the average cost of health insurance for a family of three, assuming two 40-year-old parents and a child, is $1,417.

For each additional child, the average cost of a Silver health plan increases by $282. A family of four, assuming it has two 40-year-old adults and two children, would cost an average of $1,699 per month to insure. The monthly rate for children under the age of 15 will remain flat, but once a child turns 15 years old, the monthly health plan premium will increase as they get older.

Individual + child
$849
Couple, age 40$1,135
Family of three (adult couple and a child)$1,417
Family of four (adult couple and two children)$1,699
Family of five (adult couple and three children)$1,981

Adults are assumed to be 40 years old. Sample rates are based on the average cost for a Silver plan in Alabama.

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Methodology

The health insurance data for rates and plans in this report is found on the Centers for Medicare & Medicaid Services (CMS) government website. Using the public use files (PUF), premiums were averaged across a variety of factors such as by metal tier, by county and by family size.

Sterling Price

Sterling Price is a research analyst at ValuePenguin specializing in health and life insurance. He graduated from Syracuse University with a bachelors degree in Finance and Accounting and has previous experience as a licensed life insurance representative.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

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