Friday, February 5, 2016

High Deductible Plans: Bad Policy

Yes, the Affordable Care Act is better than what we had before. No, it's not the solution the people of this country need for their health care. A few examples.

From a friend's Facebook post:

I open a letter from CareFirst telling me that our health insurance coverage went up $260 a month beginning January 1 and that we're already $520 short for the year. Our monthly health insurance bill for a family of three is now $1,367.82 with a $6,000 deductible. Which means the only entity "insured" by anything is CareFirst itself, insured against the fact that they'll ever have to pay for any of our health care for the next six or so months. It's a great fucking system we have.
This is similar to my family's insurance costs. Many others insured through their state exchange or are in the same boat, except they get a subsidy on those payments. But they're still on the hook for that crazy deductible if something happens to them, like my broken ankle.

What's the outcome of these costs? From today's Star Tribune:
An increase in Minnesotans with health insurance hasn’t decreased the uncompensated care provided by the state’s hospitals, but it has caused a shift from outright charity care to bad debt from insured patients who couldn’t afford their medical bills.
One downside, from the hospitals' point of view:
Writing off the cost of a needy patient as upfront charity is more efficient and less stressful than trying to collect from someone who’s broke and can’t pay insurance deductibles.
Oh, the poor hospitals. They're stressed out by having to collect on debts. Imagine how the people in debt feel!

Here's another story about why high-deductible plans, which are all we are allowed to buy anymore because coverage that actually covers things is considered to be a "Cadillac plan." A family I know, both parents lawyers who have their own small firm, are on an individual plan like mine with a $6,000 or higher deductible. They have two young teenage daughters active in sports. One kid twisted her ankle at a soccer game on a Friday evening and mom had to decide whether to take her to the emergency room for an X-ray to figure out if it was broken or wait until Monday to see if it got better.

These are well-off people with insurance, but they don't take their kid for an X-ray. And I understand that hesitation. This is what "skin in the game" looks like. This is what finance wonks want to have happen. Is it what you would want for your kid, though, in the richest country in the world?

As I wrote in a post from a few years ago,
How can a person who's sick judge whether a test is necessary? We don't have enough information to know the answer. But we do know if we can afford it or not, so if it's not covered by insurance, it's pretty easy to know which way the question will be answered.

1 comment:

Gina said...

The high deductible plans were designed for younger, healthier people who statistically would not need extensive coverage. It used to be that younger, healthier people paid the same as everyone else.

If I had wanted to keep the same coverage I had last year, which was excellent (no deductible, $2500 out of pocket, all my drugs except one on formulary and all my docs and hospitals in network) I would have had to pay $1000 per month premium which is $12000 per year + 2500 = $14500 total cost, and since BCBS was not enrolling the plan in MNSure again, I would not be able to get subsidy help for it. I am single, no dependents. The year before my total was around $8400. The year before that it was around $8400. Now the insurers have figured out how to use ACA for their own profit, so it's failed in that regard. The insurers are not the insureds' friends and they do not have our best interests in mind.