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The objective of UCC is to relieve the threat of financially ruinous medical bills for the very poor and very sick while requiring those who can to pay an affordable share of the cost of their own non-catastrophic care. To accomplish that, UCC sets an income-based cap on each household’s health care spending. The cap is defined by a number of parameters. The simplest version of UCC would have just two parameters, a low-income threshold and, for those above the threshold, a deductible that varies with household income. The low-income threshold is a level of household income below which even moderate medical expenditures would threaten serious financial distress. Under UCC, people whose incomes are at or below the threshold would have their health care costs covered in full. The dollar value of the threshold would vary with family size. For example, the threshold could be set equal to the federal poverty level (FPL) or a fixed percentage of it. As of 2019, the FPL stood at approximately $12,500 for an individual and $25,000 for a family of four. A household’s eligible income is defined as the amount by which household income exceeds the low-income threshold. In a simple version of UCC, the deductible could be set at, say, 10 percent of eligible income and the low- income threshold at the FPL. A family of four with total income of $50,000 would then have eligible income of $25,000 and a deductible of $2,500. A family with total income of $100,000 (approximately the upper limit of eligibility for premium subsidies on the ACA exchanges) would have a deductible of $7,500. A family with total income of $1 million would have a deductible of $97,500, and so on. Income could be defined as adjusted gross income reported on the previous year’s tax return, with some form of averaging for people with highly variable incomes. In addition, a UCC plan could include additional cost sharing in the form of coinsurance and copayments. For example, suppose the low-income threshold were set to the FPL and the deductible at 10 percent of eligible income. Coinsurance of 20 percent could then be assessed for health care expenses from 10 percent to 35 percent of eligible income. A family of four with eligible income of $50,000 would then face a deductible of $5,000 and 20 percent coinsurance on expenditures from $5,000 to $17,500. The family’s out-of-pocket maximum would then be $7,500, consisting of the $5,000 deductible plus $2,500 in coinsurance. Some UCC proposals also include a premium, which would be paid whether or not a household had any health care expenses in a given year. The premium, too, could vary with income, starting at zero for families below the lowincome threshold and following a sliding scale for those with higher incomes. A household’s total contribution to the cost of care would then be the sum of its out-of-pocket spending and its premium. Finally, many versions of UCC include a package of preventive services that would be exempt from cost sharing to avoid discouraging their use. Taken together, these UCC parameters define two zones, shown schematically in Figure 4. Households fall into one zone or the other according to income and health care spending. The full coverage zone includes those whose incomes are so low or whose health care needs are so great that any additional medical expenses would threaten financial catastrophe. They get full, first-dollar coverage of their health care expenses, at the margin, although those who are above the lowincome cutoff must first satisfy their deductible, copay, and coinsurance requirements. Access to care for people who fall into the full-coverage zone is a key concern of reformers who favor a single-payer approach. The cost-sharing zone comprises people who are healthy and/or wealthy enough that they do not fully meet their cost-sharing requirements. People in this zone face immediate economic incentives to shop carefully for health care services and to manage their expenses in a prudent manner. Some of them may do so by paying out of pocket, others may pay from health savings accounts, and still others may buy supplemental insurance or join health care sharing organizations. These incentives and mechanisms play an important role in market-based reform strategies. Figure 4: Coverage Zones The relative sizes of the two zones and the location of the borders between them depend on the values assigned to the various UCC parameters. The next section examines some of the considerations that go into deciding how those parameters should be set.