How much can people afford to pay for health care?

That question is at the heart of the current debate in Congress about a health care overhaul. Yet there is not a firm consensus among lawmakers, economists and health policy experts-and that is complicating efforts to come up with a common approach.

At issue is how much Americans should be expected to spend on insurance premiums before getting help from the government-or before being exempted from any proposed requirement to have coverage. The problem involves underlying disagreements about the nature of what’s affordable and how to calculate it.

It’s not just an academic issue. Different approaches produce vastly different results: the latest health overhaul proposal, unveiled Wednesday by Senate Finance Chairman Max Baucus, D-Mont., would subsidize the insurance costs of 8 million fewer Americans in 2019 than would the original House bill introduced in July, according to projections from the Congressional Budget Office. Not coincidentally, under Baucus’ plan, 25 million Americans would lack health coverage in 2019 – 8 million more than envisioned under the original House plan. Currently, about 46 million Americans are uninsured.

“Affordability is not a technical term,” says Mark Pauly, a professor of health care at the Wharton School at the University of Pennsylvania. “It’s a matter of a value judgment. We haven’t really sorted it out, and I don’t think there is any good analytical way of doing it.”

Many economists say that health care is such an essential part of modern life, along with housing and education, that people should devote a large chunk of their income to insurance. Some of these economists, including ones who have been advising Democratic lawmakers, believe that the best way to determine what’s affordable is to figure out what people are paying for coverage now.

Jonathan Gruber, a professor of economics at the Massachusetts Institute of Technology, says that families of four earning at least $88,000 (which is four times the federal poverty level) can “readily” spend $13,000 on health care costs. “Maybe not happily, but without eating into their essentials,” he says.

But other health care experts believe this approach is flawed. Some researchers have found that many low and moderate earners often have scant savings to pay for unexpected illnesses. They say that many families start avoiding visits to the doctor and putting off treatments when they have significant out-of-pocket costs.

Such analyses lead policy makers to conclude that if Congress wants people to deal with serious illnesses before they become debilitating-not to mention far more expensive to treat-lawmakers should make coverage as inexpensive as possible. This is even more important because if people are very ill, they often cannot work, losing income even as other needs arise, these researchers argue.

“Chances are you have other expenses: you need more child care, you’re missing more work, you may need help doing errands,” says Karen Pollitz, a researcher at Georgetown University’s Health Policy Institute.

This disagreement is behind some central disputes in Congress over which families need financial subsidies to buy coverage, and the amounts they need. In their legislation, House Democrats would provide federal subsidies to individuals earning $43,320 and families of four earning up to $88,200 a year. Baucus’ proposal would limit assistance to individuals earning $32,490 and families of four earning $66,150, or three times the poverty level. That would leave out 33 million Americans from the pool of people potentially eligible for subsidies in the House plan, according to the Kaiser Family Foundation. (KHN is a program of the foundation.)

In addition, the Baucus plan would provide less money in those subsidies than the House proposal, requiring low and middle earners to pay more for health care. Under Baucus’ plan, a family of four earning about $55,000-2 ½ times the poverty level-could end up paying as much as $11,738 on premiums, deductibles and co-insurance in a year. Under the latest version of the House plan, the family would be on the hook for no more than $8,816. The difference is 21 percent of the family’s income versus 16 percent.

Neither proposal deals with another wrinkle in setting a standard for affordability: the degree to which the cost of living varies based on location. David Cutler, a Harvard economist who advised President Barack Obama on health care during the 2008 campaign, says: “If you ask people should a family that earns $65,000 be able to pay for health insurance on their own, the answer you get in rural Tennessee is different from the answer you get in New York City.”

An additional challenge: What may be affordable for families with routine health care costs can be overwhelming in the face of chronic problems such as cancer that often require many years of treatment. Such costs might be manageable for families once a decade, but they become potentially bankrupting when accumulated year after year. A study done by Kaiser Family Foundation researchers and published in the journal Health Affairs found that among people with private insurance, nearly 10 percent with chronic conditions went without needed prescription drugs because of the cost.

“Generally people can have bad years where they’re really sick and they could hit out-of-pocket maximums,” says Linda Blumberg, a researcher at the Urban Institute. “That’s not going to be the typical experience, but we need to be sensitive to that because there are going to be more people who are put in a difficult position.”