AAA-Actuarial Value under the Affordable Care Act

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The authors identify three key points:

  • Actuarial value can be used to compare different plan designs to determine the relative generosity of each plan.
  • Under ACA, actuarial values potentially can be structured based on one of two approaches: plans with similar benefit designs would have similar actuarial values or actuarial values would correspond more directly with the expected share of spending paid by the plan.
  • Because premiums incorporate factors that are not included in actuarial value calculations premiums are not necessarily correlated with actuarial values. In addition, actuarial value calculations do not incorporate various plan characteristics that may be important to consumers including premiums, provider network adequacy and quality, care management programs, wellness programs, and customer service.