U.S. News ranks best health insurance plans

New tool uses CMS data on insurers to determine who provides the best plans

U.S. News & World Report has released its first ranking of health insurance plans, in an effort to help individuals and families better shop for their own coverage.

Currently, 14 million Americans are covered under plans that are offered in the individual market, but that figure is expected to rise as a result of the Affordable Care Act's individual mandate, which stipulates that those who opt out of health insurance will pay a penalty.

Methodology: Rankings take into account scope of coverage and costs

U.S. News ranked each health plan based on two criteria: the cost of the insurance premium; and each plan's scope of coverage, which includes 10 categories of essential health benefits, deductibles, and out-of-pocket expenses.

U.S. News gave each of the 10 essential health benefits—defined by the Institute of Medicine—a weighted point value based on their relative importance. For example, the maximum score for prescription drug coverage is six points because of how drugs can generate significant expenses over time and affect a large share of customers; whereas the maximum score that a plan could receive for appropriate medical device coverage is 0.5 points.

Raw point scores were then converted to a star rating ranging from one to five.

Analysts at U.S. News used data that CMS collected and released about insurers that sell individual and family plans to consumers (Sternberg, U.S. News, 8/7; Sternberg/Young, U.S. News, 8/7).

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