Monday, November 12, 2007

Affordable Health Insurance Test

This is only a test. If it were real life, most people would make a failing grade.

The purpose of this test is to illustrate ways to make health insurance more affordable for the average consumer.

Our test family lives in a middle class zip code in greater Atlanta. The parents are early 40's with two children, including one of college age. Everyone is assumed to be healthy.

The family visits the doctor about 8 times per year and no one is on medication.

They are given a choice between two plans (out of approximately 1800) from a major carrier. These are not the most expensive nor the least expensive plans.

One plan is $393 while the other is $838.

The lower priced plan has no copays and a $5,000 deductible. The higher price plan has doc & Rx copays and no deductible.

Given the choice between these two plans, most consumers would opt for something similar to the higher priced plan, especially if money were no object. Even when they pay the full premium and all out of pocket costs themselves, most will opt for a variation of plan B over the other plan.

If their goal is to maximize total health care dollars, they failed the test.
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