U.S. News & World Report is out with its annual index on health insurance and its impact on the economy. To the surprise of few, many of the costs are declining or at least not rising at the dizzying pace they had been.
But much of those savings are going into the pockets of businesses and insurance companies, with consumers picking up an increasing share of out-of-pocket expenses because many companies are going to higher deductible plans to offset hikes in premiums. That, according to new studies, is actually making people sicker because they cannot afford or don’t want to pay the thousands of dollars required for visits or higher drug co-pays.
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For most American workers, the passage of the Affordable Care Act was good news and bad news. Many more now have access to insurance. But while premiums have risen only 3 percent in recent years, the shifting of the cost burden through deductibles, coinsurance, and copays has heaped a heavier burden on those who buy the insurance, especially families in low-income and blue-collar jobs such as construction or trades. Between 2000 and 2013, out-of-pocket expenses by consumers nearly doubled to $1,217 per person, with the biggest jump coming after the Great Recession in 2009.
Regulators and health plans posit that higher out-of-pocket expenses force consumers to make more prudent choices in accessing health care. In practice, subscribers are avoiding many necessary treatments and drugs rather than pay for them out-of-pocket.
But the problem clearly isn’t limited by age or income. Part of the formula for getting everyone covered is for health plans to get everyone into the pool and the way they do that is through lower premiums. And the way to lower premiums is through higher deductibles.The plans calculate that younger, healthier workers will be attracted to the lower premium and not pay attention to what it may cost them if they actually get sick.
It is a cost that is hiding in plain sight.
This is a Hobson's choice (assuming I am spelling that correctly). On the one hand it is clear that if someone else is paying for it, patients (never consumers in my book) will make more profligate use of health care. I have observed that among my own set of acquaintances also.
ReplyDeleteOn the other, they have little ability to discern between necessary and unnecessary care so when they have to pay for it poor choices are made. However, this may be partially due to the absurdly high prices for drugs and health care i the first place. Somehow, a happy medium must be attained.
Excellent blog as always.
ReplyDeleteEven when someone else is paying for it, I ask questions. I go by medical research and I find so many doctors out there who don't, it doesn't surprise me that there is a lot of care that isn't useful out there. When I go by the books (or research), I find that care is less expensive.
While doctors talk about the "baggage" we bring in terms of believing Oprah and Dr. Oz, I find some doctors believing in their own "stuff" without a shred of scientific evidence sometimes. So its amazing how the medical community thinks we are "nuts" for doing so, judges us, but when we turn the tables on them, the knives come out.