Health plan comparison with Actuarial Value Calculator (AV Calculator)

Health plan comparison with Actuarial Value Calculator (AV Calculator)
  • Post published:January 18, 2021
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  • Post last modified:January 18, 2021
  • Reading time:29 min(s) read

Introduction

This calculator helps you to compare different health plans and decides what is more beneficial to you. The Actuarial Value Calculator (AV Calculator) is designed to give an estimate of the actuarial value for a given health plan design.

This version of the AV Calculator uses data from a large national commercial database to build continuance tables by metal tier. For proper usage of the AV Calculator, please enable all macros.

The template of the AV Calculator also allows the user to insert the Plan Name, the Plan’s HIOS ID and the Issuer’s HIOS ID.

Overview of 2020 AV Calculator Updates

This section provides a brief discussion of the changes between the 2019 AV Calculator and the 2020 AV Calculator. For a more comprehensive discussion of these changes, please see the 2020 AV Calculator Methodology.

  1. Claims Projection Factor: Projects from 2019 to 2020.
  2. Maximum Out of Pocket (MOOP) Limit: Increases estimated MOOP limit to $8,250.
  3. The “Number of Enrollees” column in the continuance tables, which does not include the effect of weighting used to construct the tables, is removed to avoid confusion.

Data Properties

The 2020 AV Calculator uses 2015 claims and enrollment data from a national commercial database of individual and small group plans to provide information on utilization and cost sharing for a standard population of enrollees.

The database does not include plan benefit design information; therefore, cost-sharing parameters are imputed. To ensure that the imputation procedure can be applied effectively, plans with utilization data that are likely incomplete are excluded.

All plans must ,

  1. be a Preferred Provider Organization (PPO), Point of Service (POS), Health Maintenance Organization (HMO), or Exclusive Provider Organization (EPO) plan,
  2. have at least one enrollee with drug plan enrollment for at least one month in a 12-month period,
  3. have at least one enrollee with full year enrollment, and
  4. have at least one member with over $5,000 in spending. In addition, specific data quality requirements apply to individual and small group plans.

To be included, individual plans must,

  1. have more than 50 members, and
  2. must have at least one claim with a maternity Diagnosis-Related Group (DRG), if the individual plan has more than 1,000 members.

For a small group plan to be included, it must have 100 or fewer employees.

Because the AV Calculator’s claims data did not include an indicator for Qualified Health Plan (QHP) status, the individual plans must meet further requirements for inclusion, designed to identify plans that comply with the Patient Protection and Affordable Care Act (PPACA).

Such plans must meet at least one of the following criteria:

(i) have 2.5 percent single new subscribers in 2015,

(ii) have at least 20 percent of its returning members from 2014 come from either plans that allowed new enrollment in 2014 or the group market, or

(iii) have a primary state that did not adopt the transitional policy.

A primary state is defined if either, in 2015, 90 percent of subscribers come from one state or, in 2014, 90 percent of members come from one state.

After imputing cost-sharing parameters, additional logic excludes implausible plan designs and enrollees with incomplete information:

  • Plans with zero spending for all enrollees;
  • Plans with imputed coinsurance rates that fall outside the range of 0-100 percent; and
  • Enrollees with unspecified sex.

Utilization data from all under 65 year-old enrollees with 4 or more months of enrollment are included. Spending for enrollees with at least 4 but less than 12 months of enrollment is annualized by age, gender, and risk score quartile based on an annualization factor derived from spending patterns among full-year enrollees.

The estimated AV of individual plans is used to determine the metal tier continuance table in which the plans appear.

The 2015 data are projected forward to 2018 values at an estimated annual growth rate of 3.25 percent per year for medical expenses and 11.5 percent per year for drug expenses. These 2018 values are projected to 2019 at 5.4 percent for medical and 11.5 percent for drugs. The 2019 values are then projected an additional year to 2020 at 6.1% medical and 9.8% for drugs.

For additional details on the methodology used to construct the AV Calculator, please refer to the AV Calculator methodology document.

Usage of AV calculator

The AV Calculator enables users to select various plan design features and, based on those selections, estimates the plan’s network liability for the given design. Please note that any data entered into greyed-out boxes will not be included in the final calculation.

User Inputs for Plan Parameters

Use Integrated Medical and Drug Deductible

Select this option if the plan has an integrated deductible for medical and drug spending.

Apply Inpatient Copay per Day and Apply Skilled Nursing Facility Copay per Day

Select these options if you would like copays to be applied per day for either inpatient or skilled nursing facility services.

Use Separate MOOPs for Medical and Drug Spending

Select this option to designate separate MOOPs for medical and drug spending. This option is only available if you do not select an integrated medical and drug deductible.

Indicate if Plan Meets CSR or Expanded Bronze AV Standard

Select this option to determine whether the plan design satisfies the PPACA cost-sharing reduction (CSR) requirements or the expanded bronze standard as finalized in the 2018 Notice of Benefit and Payment Parameters final rule at 45 CFR 156.140(c). Below we provide guidance on which metal tier users should choose to align with the expected utilization for each plan variation. Please note that the metal tier continuance tables below should be used regardless of any error message prompting the use of a different continuance table. Please note that CSR plans have separate cost-sharing requirements that are not reviewed in the AV Calculator, such as reduced MOOP limits.

  • Household Income of 100-150% FPL: CSR Plan Variation AV of 94% (use Platinum Continuance Table)
  • Household Income of 150-200% FPL: CSR Plan Variation AV of 87% (use Gold Continuance Table)
  • Household Income of 200-250% FPL: CSR Plan Variation AV of 73% (use Silver Continuance Table)

The expanded bronze plan option in the AV Calculator, on the other hand, allows the user to calculate AV for bronze plans that meet certain requirements and therefore, would be allowed to utilize an expanded bronze plan de minimis range.

The option may only be used if the Bronze plan either covers and pays for at least one major service, other than preventive services, before the deductible; or meets the requirements to be a high deductible health plan within the meaning of 26 U.S.C. 223(c)(2) as established at 45 CFR 156.140(c).

The 2020 AV Calculator does not check the plan for compliance with the requirements to use the expanded bronze plan de minimis range. It is the responsibility of the bronze plan issuer to ensure that its bronze plan meets the requirements under this policy at 45 CFR 156.140(c) if the issuer uses the expanded bronze plan de minimis range in the AV Calculator.

For those bronze plans, the allowable AV variation for such plans is -4 percentage points and +5 percentage points. Please see the AV Calculator Methodology, 2018 Notice of Benefit and Payment Parameters final rule, and the Market Stabilization final rule for more information.

Desired Metal Tier

Select the desired metal tier for the plan. If your plan design produces an estimate between metal tiers and therefore is not in the de minimis range, please specify an alternative plan design.

Health Saving Account (HSA)/Health Reimbursement Arrangement (HRA) Options

The AV Calculator uses the continuance table for combined expenses to identify the average cost per enrollee at the annual HSA or HRA contribution amount. The HSA or HRA contribution amount is capped at the level of the deductible accounting for enrollee cost sharing below the deductible.

Tiered Network Options

Tiered network plans may have multiple tiers of service whereby the course of care is steered towards coordinated resource use and treatment. Patients typically pay more cost sharing in the non-preferred tier.

To calculate the AV of a plan with “tiered” network utilization or point of service cost-sharing structure, enable the blended network option. This requires you to populate two cost-sharing designs for the general benefit portion (deductible, coinsurance, and MOOP) and for service-level cost sharing for each tier.

For each tier’s utilization, input the percentage of claim spending anticipated in each tier as a proxy for claims cost after cost sharing. These proportions should add up to 100 percent. Please note that when calculating CSR plan variations, these percentages cannot vary from the percentages used for the base silver plan.

Tier 1 Plan Design and Tier 2 Plan Design

Select the deductible, general coinsurance rate (for services that will not be “carved out”), and MOOP limit. If you selected the separate MOOP option, include separate MOOPs for drug expenses and medical expenses. Fill in these values for Tier 1 only, unless the plan is a blended network plan. In that case, fill out specifications for Tier 1 and Tier 2.

Options for Specific Benefit Types

The AV Calculator considers benefits in three separate and distinct phases: the deductible phase, the coinsurance phase, and the after-MOOP phase.

The deductible phase occurs before the deductible is met. During the deductible phase, the only option for enrollee cost sharing is a copay.

Coinsurance is not supported during the deductible phase. Services not Subject to Deductible and without a copay are treated as covered at 100 percent by the plan until the deductible is met through enrollee payments for other services.

If your plan includes a coinsurance rate during the deductible phase, please refer to the Frequently Asked Questions section for further guidance.

The coinsurance phase occurs after the deductible has been met, but before the MOOP is met. During the coinsurance phase, copays or coinsurance are supported.

The after-MOOP phase occurs after the MOOP has been met; the plan covers all costs during this phase.

Subject to Deductible and Copay, if separate

You can generate a variety of plan designs based on whether or not a service is Subject to Deductible and on the value entered into the Copay, if Separate field.

  • If Subject to Deductible is selected, and no copay is entered, the cost of the service is covered by the enrollee and applied to the deductible at 100 percent.
  • If Subject to Deductible is selected and a copay is entered, the enrollee pays both the copay and the remainder of the cost, with the latter counting towards the deductible. Note that this is a less generous benefit than selecting Subject to Deductible without specifying a copay.
  • If Subject to Deductible is not selected, and no copay is entered, the service is assumed to be covered at 100 percent by the plan in the deductible range.
  • If Subject to Deductible is not selected and a copay is entered, the cost of the service is covered by the plan except for the copay amount, which is covered by the enrollee and does count towards the deductible.
  • If Subject to Deductible is selected, Copay applies only after the deductible is selected, and a copay is entered, the cost of the service is covered by the enrollee and applied to the deductible at 100 percent. Once the deductible is met, the copay applies (please note that to use this feature, Subject to Deductible must be selected while Subject to Coinsurance must be unselected).
  • Note that coinsurance during the deductible range is currently not supported in the AV Calculator. Before the deductible is met, services may not be subject to a coinsurance rate.
  • Note that if Subject to Coinsurance is selected, no copay is used during the coinsurance range regardless of any entry in the Copay, if separate field as a copay and coinsurance rate cannot apply at the same time in the coinsurance range.

Subject to Coinsurance and Coinsurance, if Different

To subject a benefit to coinsurance, the coinsurance checkbox must be selected. If you designate a service as Subject to Coinsurance but do not enter a custom rate, the general coinsurance rate will be applied.

Otherwise, the custom rate will be used. Designating a Coinsurance, if Different rate is for cases where the coinsurance rate is different from the general coinsurance rate of the plan. If Subject to Coinsurance is not selected, then the copay rate will determine the cost of that service in the coinsurance range.

For additional information on the AV Calculator’s copay, coinsurance, and deductible options, please refer to the tables in the Appendix.

Benefit Type Details

Primary Care and Specialist Office Visits

If special cost-sharing provisions are indicated for Primary Care and/or Specialist Office Visits but X-rays do not have special cost-sharing provisions (not having special cost-sharing provisions is defined as being Subject to Deductible and Subject to Coinsurance, with no special coinsurance rate and no copay), office visits that include X-rays will be split into their component parts. For example, if Primary Care office visits are not subject to the deductible and have a $20 copay, but X-rays are subject to the deductible and general coinsurance, a Primary Care office visit that includes an X-ray will have the Primary Care cost sharing applied to both the office visit and the X-ray. The AV Calculator will indicate if the special cost sharing was engaged in the AV calculation in the Additional Notes field.

Outpatient – Facility and Outpatient – Professional Visits

Five service types (Mental/Behavioral Health and Substance Use Disorder Outpatient Services; Imaging; Speech Therapy; Occupational Therapy and Physical Therapy; and Laboratory Outpatient and Professional Services) include services also classified as Outpatient-Facility and Outpatient-Professional.

If special cost-sharing provisions are indicated for Outpatient – Facility and/or Outpatient – Professional claims and no special cost sharing is indicated for the service type, services including both an Outpatient-Facility and Outpatient-Professional component will be split into their component parts and the relevant cost sharing applied.

For example, if Speech Therapy is not Subject to Deductible, is Subject to Coinsurance, and is subject to a $40 copay, and Outpatient Facility claims are Subject to Deductible, and subject to a specific 60 percent coinsurance rate, the Outpatient Facility component of a Speech Therapy claim will be subject to the $40 copay.

Note that service-specific special cost-sharing features are always primary to any input in the Outpatient Facility Fee and/or Outpatient Surgical Physician/Surgical Services fields.

For instance, if special cost-sharing features are input for Mental Health and Substance Use Disorder Outpatient (MH/SUD) Services, the service-specific cost-sharing features are applied to both the Professional and Facility components of MH/SUD services while inputs in the Outpatient Facility Fee and Outpatient Surgical Physician/Surgical Services fields are ignored for the MH/SUD service category.

Please note that the purpose of the AV Calculator is to determine the metal tier level of the plan and was not intended as a tool to demonstrate compliance with mental health parity rules.

The AV Calculator will indicate if the special cost sharing was engaged in the AV calculation in the Additional Notes field.

Drug Benefits

The AV Calculator includes four tiers of drug utilization:

  • Generic drugs indicate drugs marketed under their official non-proprietary or chemical name.
  • Preferred brand drugs indicate formulary drugs or drugs with preferential pricing marketed under a brand name.
  • Non-preferred brand drugs indicate formulary drugs or drugs with non-preferential pricing marketed under a brand name.
  • Specialty drugs indicate drugs used to treat complex or rare conditions, and often have unit costs above $500 per script.

Other Benefit Type Notes

  • Prescription benefits must use the default coinsurance rate if both a coinsurance rate during the coinsurance range and a copay during the deductible range are being applied.
  • Preventive care visits are defined as those services covered at 100 percent, per section 2713 of the Public Health Service Act.
  • Well-baby preventive care visits are included in preventive care, per section 2713 of the Public Health Service Act.
  • Well-baby non-preventive care visits are included in Primary Care.
  • Emergency room services and all inpatient hospital services include both physician and facility components.
  • Outpatient surgery physician/surgical services also include outpatient professional services that are not otherwise classified.

Options for Additional Benefit Design Limits

Set a Maximum on Specialty Rx Coinsurance Payments

Select this option to limit the amount of coinsurance on specialty prescription drugs by capping the maximum coinsurance payment on specialty drugs at a set amount. Enter the maximum coinsurance payments for specialty prescription drugs.

Set a Maximum Number of Days for Charging an IP Copay

Select this option to limit the number of days that a patient can be charged an inpatient copay. Note that the calculator uses the number entered as the maximum number of days an enrollee can be charged the inpatient copay per enrollment year. This number does not represent a per stay maximum, although for most enrollees there will only be one stay per year. The use of this option requires the simultaneous selection of the Apply Inpatient Copay per Day option. Enter the maximum number of days.

Begin Primary Care Cost-Sharing After a Set Number of Visits

Select this option to begin primary care cost sharing after a certain number of (fully covered) visits have occurred. Note that usage of this option does not imply a benefit design for primary care visits after the initial fully covered visits have occurred. The user must still indicate whether or not primary care visits are Subject to Deductible and any other cost-sharing provisions during the coinsurance range. Enter the number of visits covered at no cost to the enrollee. Also see Table 3 of the Appendix.

Begin Primary Care Deductible/Coinsurance After a Set Number of Copays

Select this option to begin subjecting primary care visits to the cost sharing entered in the primary care line of the AV Calculator only after a certain number of primary care visits with copays have occurred. In addition to inputting any copay amount, the option must be used in conjunction with the Subject to Deductible option for primary care services. Unchecking Subject to Deductible with this option will result in an error message. Note that usage of this option implies that any primary care visits which occur after the initial copays and before the enrollee reaches the deductible will be considered subject to the deductible with no copay regardless of whether primary care is Subject to Coinsurance or whether a specific Coinsurance, if different rate has been entered. This option cannot be used to apply coinsurance during the deductible range. For the coinsurance range, the user must still indicate whether or not primary care visits are subject to any other cost-sharing provisions during the coinsurance range. Enter the number of visits covered before other cost sharing applies.

Final Step: Pressing the Calculate Button

Once all parameters are entered, pressing the calculate button will begin the calculation. If the metal tier that was indicated as the desired metal tier does not match the calculated AV, you will be prompted to recalculate using the appropriate continuance tables. Note that it is possible to cycle back and forth “between” metal tiers. Because different utilization is being applied based on the selected metal tier, the selection of a metal tier to run the AV calculation can affect the AV.

Additional Notes

The 2020 AV Calculator includes a row for Additional Notes to assist AV Calculator users in understanding the AV Calculator’s assumptions. There are three potential messages:

  1. “One or more services are not subject to the deductible and have no copay. Any service with this cost-sharing structure is covered at 100% by the plan in the deductible range.” To clarify the AV Calculator’s assumptions to the user, this note indicates that the plan includes at least one service with no enrollee cost sharing below the deductible. If this is not the intended plan design, please make necessary corrections to how the plan is entered in the AV Calculator. Note that coinsurance cannot be applied below the deductible.
  2. “Office visit-specific cost-sharing is applying to x-rays in office settings.” This note indicates that office visit cost sharing is applying to x-rays which occur in office settings. For more information see the Primary Care and Specialist Office Visits section under Benefit Type Details.
  3. “Service-specific cost-sharing is applying for service(s) with facility/professional components, overriding outpatient inputs for those service(s).” This note indicates that service-level cost sharing is applying to facility and professional components associated with specific services instead of the entered outpatient cost sharing. For more information see the Outpatient – Facility and Outpatient – Professional Visits section under Benefit Type Details.

Frequently Asked Questions

Q: My plan has a deductible equal to the MOOP. What do I put in the coinsurance field?

A: A coinsurance rate of 100 percent should be entered to calculate the AV of a plan whose deductible is equal to the MOOP as there is no coinsurance in the plan. Similarly, as there is not a coinsurance range in this plan, the “coinsurance, if different” field for each type of medical and drug benefit should be left blank.

Q: What is the difference between the combined continuance tables and the separate continuance tables ?

A: For the separate continuance tables, the spending brackets represent the allowed amount spent only on the respective type of service (i.e., medical services alone for the medical continuance tables). This is in contrast to the combined tables, which utilizes the total allowed amount for an enrollee as the basis of classification into a spending bracket. A given spending level in the separate continuance tables generally represents a greater spending level in the combined tables. The calculator employs an actuarial algorithm to combine the tables for the calculation of the MOOP range in the case of a combined MOOP. Due to this approximation, for plan designs where it is possible to use either separate drug and medical deductibles or a combined deductible, AV should be calculated using the combined tables; however, AV Calculator users should take into consideration that if they input a plan with a combined deductible, then any drug copays count towards the combined deductible, which could move medical services into the coinsurance range faster. If a user inputs a plan with separate deductibles, then any drug copays do not count towards the medical deductible.

In the 2020 AV Calculator, the column in the continuance tables labeled “Number of Enrollees” has been removed to limit user confusion. The number of enrollees previously provided in that column does not reflect all weighting used to adjust the population in the underlying claims data to represent the standard population. Therefore, we eliminated this column to prevent users from incorrectly using these numbers for other calculations based on the continuance tables.

Q: How do I specify a copay in the deductible range and a coinsurance rate in the coinsurance range for drug benefits?

A: To prevent a misinterpretation of the results for drug benefits, a separate copay and coinsurance for prescription fields is not directly supported. However, a design with both a copay in the deductible range and a coinsurance in the coinsurance range is possible by selecting Subject to Coinsurance to apply the general coinsurance along with copays before the deductible.

Q: How do I specify a copay in the deductible range and a coinsurance rate in the coinsurance range for medical benefits?

A: Input a copay into the Copay, if separate field (and uncheck Subject to Deductible if appropriate) and ensure that the Subject to Coinsurance option is selected; for descriptions of these options please refer to the Options for Specific Benefit Types section of the User Guide.

Q: How do I specify copays that should be paid in conjunction with coinsurance in the coinsurance range?

A: This feature is not supported in the 2020 AV Calculator.

Q: Why is it that changing the copay and MOOP structure does not seem to affect AV by more than 0.1?

A: First, ensure that all appropriate Subject to Deductible and Subject to Coinsurance check boxes are selected. Also, please review this section and the Notes to Users section below.

Q: Why does my plan’s AV not exactly match when I input the same cost sharing in different ways?

A: In most cases, the AV Calculator calculates the same cost sharing regardless of how you input the plan design, but in certain cases, you may find when comparing methods to input plan designs into the AV Calculator that there may be fractional differences in the AV depending on the methodology being used. This slight variation in AVs is permitted as long as it is within the de minimis range defined by regulation. In addition, the AV Calculator calculates AV to the fifth decimal place to ensure that AV calculations are consistent across different machines and versions of Excel.

Q: What if my plan design has unique features that do not fit the parameters of the AV Calculator and there is a material difference?

A: Please refer to 45 CFR 156.135(b) and Question #2 in the Frequently Asked Questions on Health Insurance Market Reforms and Marketplace Standards (May 16, 2014) available at:

http://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/Final-Master-FAQs-5-16-14.pdf

Q: How do I remove enrollee cost sharing from a given service?

A: Deselect Subject to Deductible and Subject to Coinsurance for the service desired to have 0 percent enrollee cost sharing. For primary care and specialist office visit services, input 0 into the Copays, if separate cell in order to subject both the office visit and any X-ray or Diagnostic Imaging services performed in the office setting to 0 percent enrollee cost sharing. Leave this cell blank if the visit is to be exempt from enrollee cost sharing, but not the X-ray and Diagnostic Imaging services performed in it. In the case that both primary care and specialist office visits are exempt from enrollee cost sharing, it is not possible to have one type of office visit exempt X-ray and Diagnostic Imaging services from enrollee cost sharing while the other type of office visit does not. For all other services, leave the Copays, if separate cell blank.

Q: How do I remove coverage from a given service below MOOP?

A: Select both Subject to Deductible and Subject to Coinsurance, then input 0 in the Coinsurance, if different cell for the service desired to have 0 percent issuer cost sharing.

Q: Can cross-accumulation of deductibles between tiers work?

A: The AV Calculator determines the single AVs associated with each individual tier plan design and averages those AVs according to the input utilization weights. Though there is no specific cross-accumulation of deductibles algorithm between tiers, this weighted average can be interpreted as a cross-accumulation of deductibles.

Q: How do I split service categories exclusively between two different tiers?

A: The AV Calculator does not have this functionality explicitly built-in. An approximation may be arrived at by referring to the continuance tables and determining what percentage of the total per member per year (PMPY) benefit the exclusive categories constitute. This percentage can then be used to weight the two tiers of plan designs based on the split service when you input the other cost sharing into the second tier.

Q: Are outpatient office visits included in the individual service categories other than the Primary Care and Specialist Visit categories?

A: With the exception of X-rays and Diagnostic Imaging, Professional Outpatient Office Visits are included only in the Primary Care Visit and Specialist Visit service categories regardless of the diagnosis accompanying those visits.

Q: Can I have a plan with a deductible, but have no services subject to that deductible?

A: To prevent implausible plan designs, the AV Calculator does not allow the user to input a plan with a deductible without subjecting a service to the deductible. The AV Calculator will give the user an error message in these cases.

Q: How do I specify coinsurance during the deductible phase?

A: To clarify how the AV Calculator has been working, this feature is not currently directly supported by the AV Calculator. The AV Calculator does not support any coinsurance until the deductible has been met. For example, if outpatient services are not Subject to Deductible, have no copay, but have an 80 percent coinsurance rate, then the plan will be treated as paying 100 percent of the costs of outpatient services until the enrollee meets the deductible. Please see Table 1 in the Appendix for additional clarification. One option for a plan that uses coinsurance before the deductible could be to enter an effective copay equal to the amount the enrollee would pay in coinsurance. If the service with an effective copay also uses coinsurance during the coinsurance range, the plan should also enter the coinsurance amount for use during the coinsurance range. Thus, the effective copay rate would apply in the deductible range, and the coinsurance rate would apply in the coinsurance range. To help AV Calculator users, the AV Calculator incorporates a message in the Additional Notes row that highlights if a service has no enrollee cost sharing below the deductible.

Q: Why does subjecting a benefit to the deductible sometimes increase AVs?

A: In some plan designs with low deductibles, relatively generous cost sharing in the coinsurance range, and copays that are subject to the deductible, subjecting a benefit to the deductible could increase AV by impacting the point at which the deductible is met. Although one service may be more expensive in the deductible range, it may cause the enrollee to move more quickly into the more generous coinsurance range and avoid more expensive cost sharing for other services in the deductible range.

Q: My plan combines cost sharing for outpatient surgical and facility services delivered within the same day into a single copay. How do I enter this design in the AV Calculator?

A: Plans with a single copay for outpatient professional and facility services may consider entering the copay in the outpatient surgical services line and leaving the outpatient facility copay as $0.

Notes to Users

Equivalent deductible check for plans with separate deductibles and combined MOOP

Whenever the user specifies a plan with separate deductibles but a combined MOOP, the AV Calculator will create an equivalent combined deductible. If the equivalent combined deductible is greater than the MOOP, then the equivalent combined deductible is set equal to the MOOP.

Effect of limiting specialty Rx coinsurance and other changes to specialty Rx benefits

Limiting the specialty Rx coinsurance amount and other changes to specialty Rx benefits typically does not have a substantial effect on calculated actuarial value. There is relatively little utilization of these types of prescription drugs below the MOOP in the underlying utilization data, so plan-covered spending is not greatly affected by changes in the amount of beneficiary cost sharing. This limited effect persists with the 2015 claims data used in the 2020 AV Calculator.

Effect of service unit cost if less than copay

The AV Calculator compares average service cost at the specified level of spending to the copay when implementing this logic. Therefore, this operation affects the calculation only if the average service cost is less than the copay, even if the copay exceeds service cost for some individuals. For example, while most generic prescription costs are low and would therefore be less than the typical generic copay, average generic costs include some high-cost generics and may exceed the copay.

The AV Calculator accepts 100 percent general coinsurance for copay based and non-copay based plans

The AV Calculator uses effective coinsurance to calculate the point at which MOOP spending is reached, allowing for a coinsurance of 100 percent to be specified for the general coinsurance in copay based and non-copay based plans.

When effective coinsurance equals 100 percent, MOOP is set equal to the deductible

If benefits are entered into the AV Calculator such that the effective coinsurance is equal to 100 percent, the AV Calculator sets the MOOP equal to the deductible for the purposes of the AV calculation since there is no independent coinsurance range.

Copays on Outpatient – Facility and Outpatient – Professional Visits

Users can enter a copay for Outpatient Facility Fee (e.g., Ambulatory Surgery Center) and Outpatient Surgery Physician/Surgical Services. Note that outpatient surgery physician/surgical services also include outpatient professional services that are not otherwise classified. Users should consider that increased utilization represented in the updated claims data may affect the impact of outpatient cost sharing on a plan’s AV.

Usage of separate drug and medical deductibles can increase service utilization in the deductible range

Evaluating a plan with a combined deductible compared to the same value being repeated twice as both the drug and medical deductibles will often result in an increase of services evaluated during the deductible range. Since the amount of PMPY spending in the drug continuance tables is drawn from a distribution independent of medical spending, the rate of drug spending faces a steeper slope than that encountered in the combined continuance tables. This can lead to large variances in the point at which MOOP is reached when comparing combined deductible plans with plans using separate deductibles. For plan designs where it is possible to use either separate drug and medical deductibles or a combined deductible, AV should be calculated using the combined tables; however, AV Calculator users should take into consideration that if they input a plan with a combined deductible, then any drug copays count towards the combined deductible, which could move medical services into the coinsurance range faster. But, if users input a plan with separate deductibles, then any drug copays do not count towards the medical deductible.

Operation of the Plan Design “Snapshot” Feature

Unless a custom prefix is specified in cell B6 of the User Guide, the AV Calculator inserts a tab named “Output[x]” each time the AV of a new benefit plan design is calculated. Tabs created using the “snapshot” feature may be moved or copied to other workbooks for reference. However, the original “AV Calculator” tab must not be moved or copied either whole or in part as doing so will result in calculation errors for subsequent runs. Additionally, auto-filling rows may impair the function of the AV Calculator and result in run-time errors (or other issues). In cases of heavy computer utilization, the screenshot function may not work as intended. If the snapshot output is either distorted or non-existent, reopening the AV Calculator in conjunction with closing any programs that are using a high portion of computer resources will resolve most issues.

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