Deductibles in the exchanges

A reader asks by email,

I had a question about deductibles under the Patient Protection and Affordable Care Act. Can they be arbitrarily high under the act?

Not really. At the same time, there isn’t an explicit ceiling. Here’s how it’s explained in a Kaiser Family Foundation document (PDF).

[T]he levels of coverage in the ACA are not defined using specific deductibles, copays, and coinsurance. Rather, they are specified using the concept of an “actuarial value” (AV). For example, a plan with an actuarial value of 70% (referred to as a “silver” plan in the ACA) means that for a standard population, the plan will pay 70% of their health care expenses, while the enrollees themselves will pay 30% through some combination of deductibles, copays, and coinsurance. The higher the actuarial value, the less patient cost-sharing the plan will have on average. The percentage a plan pays for any given enrollee will generally be different from the actuarial value, depending upon the health care services used and the total cost of those services. And, the details of the patient costsharing will likely vary from plan to plan.

For more on coverage in exchanges, costsharing, and actuarial value, read the KFF doc. (Aside: I didn’t know “costsharing” was one word now. I don’t believe I ever used it as such. Maybe I will now. But it feels weird.)


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