Bronze ACA plans are skimpy, but compared to what?
As a relative newbie to the wonderful world of U.S. health insurance, I have been troubled by the skimpy coverage of the lowest-tier bronze plans offered on the ACA exchanges. Mandated to cover 60% of the average user's yearly medical expenses (that is, to maintain an actuarial value of 60%), bronze plans carry an average individual deductible of over $5,000.*
On the plus side, only 20% of ACA private plan buyers in 2014 selected bronze plans, most of them probably in higher income brackets. By my estimate, over half of ACA buyers obtained plans with an actuarial value of 80% or higher, including about 90% of buyers with incomes under 200% of the Federal Poverty Level, who accessed Cost Sharing Reduction subsidies by buying silver plans. And while ACA coverage can have troubling limitations, from high deductibles to narrow networks, I just stumbled on information that indicates what an improvement the actuarial mandates constitute.
This 2012 study found that more than half of the health plans sold in the individual market in 2010 had actuarial values of less than 60%, and that 60% was the average AV of all plans sold on the individual market in that year. Many of the "rate-shocked" holders of canceled individual market plans who hit the news in fall 2013 probably had plans that were skimpier than ACA bronze -- though a fair number may have been happy with plans that had coverage exclusions that did not affect them.
There are probably about as many off-exchange as on-exchange buyers in the post-ACA individual market. According to a survey of its own customers conducted last February by online health insurance broker eHealth, bronze plans were most popular among that group, and average deductibles among eHealth buyers were about midway between averages for bronze and silver exchange plans for individuals and a bit closer to silver plan averages for families. Those numbers suggest an average AV among eHealth customers in the 65-67% range. How representative they are of the off-exchange individual market as a whole I can't say.
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* While all must offer the ACA's mandated free preventive services, many bronze plans provide no other benefits until the deductible is reached, offering essentially catastrophic coverage only.