Benefits Benchmarking Tool FAQs

What’s the source of the underlying dataThe Kaiser Family Foundation Employer Benefits survey underlying data, trended from 2018, with 2020 data + proprietary employer data.

 

How often is the data refreshed? Once per year for Kaiser data; employer data is loaded periodically. Latest version is effective April 2021.

 

What is plan value? Plan value approximates actuarial value, or, on average, the percentage of in-network claims paid by insurance. Values range between 60% to over 90% and are often referred to by metal levels. Bronze is 60%, Silver 70%, Gold 80%, and Platinum 90% +/- 2%. Healthier people will have lower claims and pay a greater percentage, while those with higher claims will pay a lower percentage of the value.

 

How is plan value calculated? A multiple regression model run using over 100 distinct plan designs and the output actuarial value from the CMS actuarial value calculator–it was found that ~85% of the actuarial value of a plan is determined by 3 factors: deductible, coinsurance, and out-of-pocket maximum. Actual results are within 1-2% for most plan structures. 

 

What are the limitations of the plan value calculation? An atypical plan design like $0 deductible and $7,000 out-of-pocket max may have a skewed plan value number. If you use outlier values like $15,000 deductibles you will not get an error. Results should end up being between 60-90% for virtually all comparable plans. 

 

What version is this tool: version number and most recent effective date are always listed below the percentile gauges.

 

What are the ranges listed in the box and whisker chart? The ranges are dollar values that reflect the interquartile range (the middle 50% or the 25th to 75th percentiles) as well as the top and bottom 10%.

 

How do the comparison benchmarks capture premiums and deductibles from multiple plans within a given firm? The data for individual firms reflect the average numbers if there are multiple plans–so if half the employees are enrolled in a $1,000 deductible plan and half are in a $3,000 deductible plan, the number represented for comparison purposes in the charts is $2,000. Firms typically offer 1-3 plans to their employees.

 

Why when I change the coverage tier to “family”, does the deductible and OOP max on the chart reflect the single-tier values? Since single coverage is the most common type of coverage used when running the benchmarking exercise, those values are used. Family deductibles and OOP max are most often 2x single. Future versions could change.

 

Does the model deductible field reflect an aggregate medical and prescription drug deductible? It reflects an aggregate deductible, which is the case for 90% of plans. 

 

I change input variables but don’t see much change in percentile ranking. Why is that? There is a lot of bunching around certain attributes, such as coinsurance. Many plans have 20% coinsurance.

 

How do I translate copays to coinsurance? Some healthcare plans have a mix of copays and coinsurance. A plan with a $25 office visit copay is approximately a 20% copay given typical charges. If there are scenarios where office visits are free and hospitalizations are 20%, you can use 20% as the coinsurance or 15-19%, since the bulk of actuarial value hinges on higher dollar categories 

How are regions defined? The four regions used in the tool are West, South, Midwest, and Northeast, and are based on the BLS classifications of regions as shown below with only the 50 states counted.

BLS Regions

last updated April 2, 2021