Catastrophic Health Insurance in California: Eligibility and Costs

Catastrophic health insurance in California is a low-premium, high-deductible plan sold to people under 30 and to older residents who receive a hardship or affordability exemption. You pay a small monthly premium in exchange for a deductible that matches the Affordable Care Act’s out-of-pocket maximum, which is $10,600 for individual coverage in 2026. Before you hit that deductible, the plan still pays in full for preventive care and for three primary care visits a year.¹

Who Can Buy a Catastrophic Plan in California

Federal law splits eligibility in two. If you are under 30 at the start of the plan year, you can enroll with no further qualification. If you are 30 or older, you need a hardship exemption or an affordability exemption first.²

Starting with the 2026 plan year, the pool got wider. Under new guidance from the Centers for Medicare and Medicaid Services, anyone whose projected household income makes them ineligible for premium tax credits or cost-sharing reductions automatically qualifies for a hardship exemption. That covers people with incomes below 100 percent or above 400 percent of the federal poverty level.³

Other qualifying hardships include bankruptcy, eviction or foreclosure in the past six months, utility shutoff, homelessness, the death of a close family member, domestic violence, caring for an ill or disabled relative, substantial medical debt, damage from a fire or flood, and sudden drops in household income from divorce, separation, or disability. You submit proof of the hardship along with dates of birth and Social Security or taxpayer ID numbers for everyone in your household.⁴

An affordability exemption applies when marketplace or employer coverage would cost more than a set percentage of your household income. Both types of exemption are processed by Covered California rather than claimed on your tax return.⁵

How to Enroll

Open enrollment for 2026 coverage runs November 1 through January 31.⁶ A qualifying life event, such as losing other coverage or moving, can open a special enrollment period outside that window.

Here is the detail that catches Californians off guard: you do not buy a catastrophic plan on the Covered California website the way you would a Bronze or Silver plan. If you are 30 or older, Covered California handles the exemption application and issues an Exemption Certificate Number, which you then take to an insurance company to purchase the plan. If you are under 30, skip the exemption step and go straight to an insurer.⁷

What Catastrophic Plans Cover

Even with the high deductible, these plans have to cover all ten categories of essential health benefits required by the ACA: emergency services, hospitalization, outpatient care, maternity and newborn care, mental health treatment, prescription drugs, lab services, and rehabilitative care.¹

Two things kick in before the deductible. Preventive services like vaccinations, cancer screenings, and annual wellness visits cost you nothing. And every catastrophic plan covers at least three primary care visits per year before the deductible applies. In California, Covered California labels these “minimum coverage plans” and confirms the three visits include outpatient mental health and substance use care with no out-of-pocket cost.⁷

For a young, healthy person who rarely needs a doctor, those three visits absorb routine checkups and most minor illnesses without touching the deductible at all.

Deductibles, Premiums, and HSAs

The trade-off is straightforward. You pay a low premium, and in return your deductible equals the ACA’s annual out-of-pocket maximum.² For 2026, that is $10,600 for individual coverage. Until you spend that amount on covered services (outside of the free preventive and primary care visits), you pay the full negotiated rate. Once you cross it, the plan covers everything for the rest of the year.

A common misconception worth clearing up: catastrophic plans are not eligible for premium tax credits or cost-sharing reductions. Those subsidies apply only to Bronze, Silver, Gold, and Platinum plans.³ If you qualify for meaningful subsidies, a Bronze or Silver plan will almost always be cheaper on net.

New for 2026: catastrophic plans can now pair with a Health Savings Account. An HSA lets you set aside pre-tax money for medical expenses, which softens the deductible. To qualify, the plan must meet the IRS high-deductible definition, which for 2026 requires a minimum deductible of $1,700 for individual coverage or $3,400 for family coverage.⁸ Catastrophic deductibles sit far above that floor, so most plans will qualify.

Catastrophic vs. Bronze

Bronze is the closest metal-tier alternative, so run the comparison before you commit. A Bronze plan pays roughly 60 percent of average healthcare costs, leaving you responsible for the other 40 percent. A catastrophic plan covers a smaller share of typical costs but caps your worst-case exposure at the same out-of-pocket maximum.⁹

The choice usually comes down to subsidies. If your income qualifies you for premium tax credits, you can apply them to a Bronze plan but not a catastrophic one, and that often pushes the Bronze premium below what you would pay for catastrophic coverage. If you earn too much for subsidies, or too little to qualify (below 100 percent of the federal poverty level), the lower catastrophic sticker price can win. The three free primary care visits partially close the gap with Bronze plans that offer copay-based visits.

The California Individual Mandate

California requires residents to keep minimum essential coverage or pay a state tax penalty collected by the Franchise Tax Board. A catastrophic plan counts as minimum essential coverage, so enrolling in one satisfies the mandate.⁵

For the 2025 tax year, filed in spring 2026, the penalty for going uncovered all year is at least $950 per adult and $475 per dependent child under 18, so a family of four faces a minimum of about $2,850.¹⁰ The actual charge can be higher, because California takes the greater of the flat per-person amount or a percentage of household income above the filing threshold, capped at the cost of an average Bronze premium. For 2026, that average Bronze premium is $420 per month.¹¹

An approved hardship or affordability exemption also exempts you from the penalty. Those two exemptions have to go through Covered California. Most others, such as employer coverage or a short gap, can be reported on FTB Form 3853 when you file your return.⁵

1
HealthCare.gov. Catastrophic Health Plans
2
GovInfo. 42 USC 18022 – Essential Health Benefits Requirements
3
Centers for Medicare & Medicaid Services. Expanding Access to Health Insurance Consumers to Gain Access to Catastrophic Health Insurance Plans
4
Covered California. General Hardship Exemption
5
State of California Franchise Tax Board. Health Care Mandate
6
Covered California. Dates and Deadlines
7
Covered California. Minimum Coverage Plans
8
Internal Revenue Service. 2026 Inflation Adjusted Amounts for Health Savings Accounts (Rev. Proc. 2025-19)
9
HealthCare.gov. Health Plan Categories: Bronze, Silver, Gold, and Platinum
10
Covered California. Penalty Details and Exemptions
11
State of California Franchise Tax Board. 2026 Individual Shared Responsibility Penalty Calculation