In nonwonk terms, actuarial value is what percent of health-care costs an average subscriber can expect to be on the hook for. An insurance plan with a 70 percent actuarial value, for example, can expect their insurance to pick up 70 percent of the tab and cover 30 percent themselves. Short story: lower actuarial value, higher cost for the policyholder. And over on the Senate bill, the actuarial values of plans that low-income Americans would likely enroll in are consistently lower than those of the House. The midlevel health insurance in the Senate bill, the silver plan, has an actuarial value of 70 percent. The comparable House-side plan--the enhanced plan--has an actuarial value of 85 percent. And for all other tiers of plans--bronze through platinum on the Senate side; basic through premium plus in House language--the Senate bill would require consistently lower actuarial values. (If you want to get into the weeds how actuarial values effect different levels of low-income families, the Center on Budget and Policy Priorities has done an excellent job with two helpful reports here and here).
To show how ridiculous this can be, using the same benefit guide (link above) for a family with a $10,000 deductible plan, the out-of-pocket maximum looks like it is $7,000, but it is actually $17,000 for In-Network services ($7,000 plus $10,000 deductible), plus $25,000 for Out-of-Network ($15,000 plus $10,000 deductible). In addition to this $42,000, the family must pay monthly premiums, all Out-of-Network costs in excess of the allowable charges, and any services that are not a benefit of the plan (no maternity benefits for a young family!). Read more...
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It's a pretty funny scenario, if you are a literate pirate. Diversity is the key to economic and political evolution.
