title: Choosing the 'best' plan in a health insurance exchange: actuarial value tells only part of the story.
abstract: In the health insurance exchanges that will come online in 2014, consumers will be able to compare health plans with respect to actuarial value, or the percentage of health care costs that a plan would pay for a standard population. This analysis illustrates the out-of-pocket costs that might result from plans with various plan designs and actuarial values. We find that average out-of-pocket expense declines as actuarial values rise, but two plans with similar actuarial values can produce very different outcomes for a given person. The overall affordability of a plan also will be influenced by age rating, income-related premium subsidies, and out-of-pocket subsidies. Actuarial value is a useful starting point for selecting a plan, but it does not pinpoint which plan will produce the best overall value for a particular person.
authors.affiliation: Towers Watson. ryan.lore@towerswatson.com
authors.forename: Ryan
authors.initials: R
authors.lastname: Lore
authors.forename: Jon R
authors.initials: JR
authors.lastname: Gabel
authors.forename: Roland
authors.initials: R
authors.lastname: McDevitt
authors.forename: Michael
authors.initials: M
authors.lastname: Slover
mesh_terms: D000206:Actuarial Analysis; D002755:Choice Behavior; D003256:Community Participation; D016536:Competitive Medical Plans; D005382:Financing, Personal; D017048:Health Care Costs; D006801:Humans; D007348:Insurance, Health; D017063:Outcome Assessment, Health Care; D014481:United States