It has been made very clear that if we do not begin to address the rising cost of health insurance premiums, no one in the middle class will be able to afford any coverage. Consider the following from the Robert Graham Center:
“With health insurance packages bought and sold as profitable commodities, adequate health insurance coverage will soon be a product of shrinking benefits, to be bought by the wealthy and sold to the healthy. Most individuals cannot shoulder the burden of rising health care costs, and medical expense now tops the list of reasons for personal bankruptcy. If the system remains the same, the number of uninsured will continue to grow.”
One of the core tenets of the Patient Protection and Affordable Care Act was the creation of Health Insurance Exchanges. According to the Commonwealth Fund, exchanges will “expand health insurance coverage, improve the quality of such coverage and perhaps of health care itself, and reduce costs.” It is within these exchanges that individuals unable to afford health insurance in the traditional marketplace can come to find a more affordable option.
Or at least that is the goal. However, with options comes choices and it is important that the community is aware of the options to make the most informed choice.
One choice that most individuals will have to make when looking for insurance on the health insurance exchanges is around the deductible. First, let’s explain deductibles.
Deductibles are fixed amounts of money one has to pay before the health policy benefit can be received; however, in most insurance policies some services can be utilized like a primary care visit or emergency room visit without having paid the full deductible first. So if an individual has a high deductible, they would need to pay in a great deal of their own money before the health insurance company started paying for services.
Doesn’t sound too appealing does it?
Well think about it for a second – the higher the deductible the lower the monthly premium (the opposite is also true). If a family is relatively healthy and looking to cut their monthly healthcare costs, they could choose a high deductible plan and pay less in premiums. So, if that family has no major health problems that year they are likely to pay less for healthcare.
So the high deductible plans may on the surface be appealing just because they “cost less” per month.
In an excellent Health Affairs article on the subject of high deductibles, author Maribeth Shannon offers three recommendations when considering what patients should do for insurance options (below are taking directly from her article):
“Understanding benefit design. At a minimum, patients need to know which services are covered under their plan and whether costs incurred will be applied toward their deductible. Fortunately, the ACA provides for a uniform approach to describing benefits through the Summary of Benefits and Coverage (SBC). The SBC seeks to provide standardized information – presented in a simplified, easy-to-access way — to help consumers understand coverage limits and estimated costs. Consumers Union and the National Association of Insurance Commissioners (NAIC) already have provided prototypes and user testing results to help shape such tools.
Understanding price. Price is still one of the most opaque areas in health care. Surveys consistently find that consumers say they want price information, but when it comes down to it, they cannot often find it. A few states (e.g., New Hampshire) have taken steps to fill this void with pricing tools drawn from All Payer Claims Databases. Some health plans have also recently launched tools for their members. To be effective, such tools have to provide specific pricing information at the individual provider level, with health plan-specific negotiated rates.
Understanding options. Also crucial for patients is reliable information about the risks and benefits of comparative treatments, and their relative value. On this front, the Patient-Centered Outcomes Research Institute (PCORI) is working on improving understanding of treatment options for both patients and their providers.”
In the current healthcare system, health insurance is critical to gain access to services. Whatever option you choose, it is important to be aware of the impact of your choice, and how that will help or hurt your chances of being healthier.