Traditional health insurance can be very expensive for most Americans as many families and individuals are looking for lower-cost alternatives that still provide the quality care they need. 

A recent study by Kaiser Family Foundation and Thatch observed a 24% increase  in employer-sponsored family health insurance premiums since 2019, with 68% of small business owners citing that the rising premiums are their biggest concern this 2025. 

In 2025, private health insurance plans will cost an average of $7,452 per year, a 7% increase from 2024, and out-of-pocket costs have consistently outpaced overall growth in healthcare spending. With the rising costs associated with traditional health insurance, the situation creates an unsustainable environment for consumers, particularly those with chronic health conditions who are actively seeking alternatives.

The good news is, there are different options that can provide quality care without breaking the bank.  

1. Direct Primary Care (DPC) 

Direct Primary Care offers a subscription-based model where patients pay a flat monthly fee for unlimited access to their primary care provider. This model eliminates insurance billing, making healthcare more transparent and affordable. It is ideal for those needing regular primary care but not extensive medical interventions.

Pros:

• Same-day or next-day appointments
• Extended visits (30-60 minutes)
• Patient-centered care
• No surprise billing or hidden fees
• Affordable medicine and imaging services
• Directly connect with your doctor anytime, any day through texts, calls or emails

Cons:

• Doesn’t cover specialist care or hospitalization costs
• May not be suitable for those with complex medical needs

2. Health Reimbursement Arrangements (HRAs) 

HRAs are employer-funded plans that reimburse employees for qualified medical expenses. Employees don’t need to pay contributions to get HRAs. HRAs are fit for small to medium businesses because it offers flexible benefits without the high costs of group insurance plans. 

An employer can either offer an individual coverage HRA or Qualified small employer HRA (QSEHRA).

Pros:

• Flexibility for both employers and employees
• Funds can be used for a variety of medical expenses (dental, vision, over-the-counter medications)

Cons:

• Limited to employer offerings
• May not fully cover all healthcare needs

3. Health Savings Accounts (HSAs) 

HSAs lets you save pre-tax money to cover the following medical costs like coinsurance, copayments, deductibles, and certain dental, drug, and vision expenses (see IRS.gov for a full list). 

You must have a High Deductible Health Plan (HDHP) to get a HSA. 

Pros:

• Contributions are tax-deductible, withdrawals can be tax-free
• Unused funds roll over each year
• MAY earn tax-free interest

Cons:

• Must be paired with a high-deductible health plan
• Can’t be used for insurance premiums
• Not suitable for those without disposable income to save

Know more about HSAs here. For details on HSA-eligible plans and deductibles, check IRS.gov.

4. High-Deductible Health Plans (HDHPs) 

High-Deductible Health Plans are insurance plans with lower monthly premiums but higher deductibles. These plans are ideal for healthy individuals who don’t anticipate frequent medical expenses.

In 2025, the IRS defines an HDHP as having: 

Minimum deductible: $1,650 (individual) / $3,300 (family)

Maximum out-of-pocket costs: $8,300 (individual) / $16,600 (family)

Pros:

• Lower monthly premiums
• Can be paired with a Health Savings Account (HSA) for tax-savings and benefits

Cons:

• High out-of-pocket costs before coverage kicks in
• Risky for those with unexpected medical emergencies
• Not ideal for those with chronic conditions

5. Medicaid 

Medicaid provides free or low-cost healthcare coverage to eligible low-income individuals and families. Medicaid is beneficial especially to Low-income adults and children, Pregnant women, Elderly adults and people with disabilities.

This government program covers a wide range of medical services, including doctor visits, hospital stays, and prescription medications.

Pros:

• Comprehensive coverage with minimal or no cost
• Access to essential healthcare services 

Cons:

• Eligibility varies by state
• Limited provider networks in some areas

Understand more of the benefits of Medicaid here.

6. Cost-Sharing Programs 

Medical cost-sharing programs are cooperative models where a group of individuals contribute to a shared fund that covers each of the members’ medical expenses. While not technically insurance, these programs often have lower monthly costs and cover major medical events. 

Pros:

• Lower monthly costs compared to traditional insurance
• Covers major medical expenses 

Cons:

• Limited coverage for preventive care or for those with pre-existing conditions
• No regulatory oversight like traditional insurance

7. Association Health Plans (AHPs) 

AHPs allow small businesses and self-employed individuals to band together and purchase health insurance as a group. By pooling resources, members can access lower premiums and broader coverage options typically reserved for larger companies.

Pros:

• Lower premiums for members
• Broader coverage options

Cons:

• Limited to specific associations or groups
• Potential for less comprehensive coverage

The Bottom Line

When considering other alternatives, it is important to evaluate your budget, need, and long-term goals. Each option has its benefits and limitations, so take the time to research and compare what suits best for you or for your family.

Elevated Health is a DPC practice in California. If you are interested in our Direct Primary Care model, you can book a consultation with our primary care team. You can sign up and be a part of our membership or call us at 714-916-5210 if you would like to know more about our services and available providers.

We are located in Huntington Beach and Redding.