Deductible
Deductibles are typically used to deter the large number of claims that a consumer can be reasonably expected to bear the cost of. By restricting its coverage to events that are significant enough to incur large costs, the insurance firm expects to pay out slightly smaller amounts much less frequently, incurring much higher savings. As a result, insurance premiums are typically cheaper when they involve higher deductibles. For example, health insurance companies offer plans with high premiums and low deductibles, or plans with low premiums and high deductibles. One plan may have a premium of $1,087 a month with a $6,000 deductible, while a competitive plan may have a premium of $877 a month with a $12,700 deductible. The consumer with the $6,000 deductible will have to pay $6,000 in health care costs before the insurance plan pays anything. The consumer with the $12,700 deductible will have to pay $12,700.
American Health Care Act of 2017
There are many variables that affect premiums, deductibles, and out-of-pocket amounts, including (among others) age and health of plan participants, availability of subsidies, funding for high-risk pools, required insurance coverage elements, lifetime limits, maximum ratio of prices charged to older persons versus younger, and the quality of insurance offered. Regarding quality, the "actuarial value" is an estimate of the percentage of total cost that a particular insurance plan is expected to cover. CBO reported that:The current law (ACA) established two taxes on high-income individuals (defined as income over $200,000 for individuals or $250,000 for couples, roughly the top 6% of earners), via a 0.9% Medicare payroll surtax on earnings over that threshold and a 3.8% tax on net investment income. The latter tax is steeply progressive, with the top 1% paying 90% of the tax, as investment income is highly concentrated with the wealthy. The ACA also established a penalty tax (related to the individual mandate) for individuals without adequate insurance, an excise tax on employers with 50 or more workers who offer insufficient coverage, annual fees on health insurance providers, and the "Cadillac tax" (yet to be implemented as of 2017) on generous employer-sponsored health plans. Combined with subsidies that primarily benefit low-income households, the law significantly reduced income inequality after taxes and transfers.