Wednesday, September 28, 2016

About those "High Deductible Health Plans"

Back in 1992, I was introduced to the world of Medical Savings Accounts. These then-cutting edge plans were unique in that they touted $1,000+ deductibles in a world where $500 was considered exorbitant. But they offered substantial savings, part (or all) of which could be socked away to help defray future needs.

As time went on, MSA's evolved into tax-advantaged HSA's, but the basic premise was undisturbed: in consideration for the insured taking on more risk, the carrier agreed to a lower premium.


Especially because a young, healthy person could sock away quite the nest egg.

Eventually, though, the ObamaTax came along, with out-of-pockets that dwarfed traditional HSA's, coupled with premiums that matched what used to be considered the most expensive "high end" plans. So: lose-lose.

FoIB Allison Bell has a terrific new article on the effect that ACA-compliant plans with ever higher deductibles - and premiums that don't reflect them - are having on the average person. She cites a new Guardian Life report "based on a recent online survey of about 1,700 U.S. workers."

And the findings are eye-opening (or cringe-worthy; your call). For instance:

"[O]only 44 percent of the workers surveyed this year told Guardian they had enough cash in a checking account or savings account to pay a $3,000 medical bill.

About 34 percent said they would use credit cards to pay bills that big


And here's another:

"About one-third of the workers in high-deductible plans said they had skipped what they thought was a necessary doctor visit, avoided a blood test, delayed a procedure, failed to fill a prescription or avoided X-rays because of cost."

We've seen this before: your insurance is too expensive to use. Of course, because plans are guaranteed issue and can't exclude pre-existing conditions, by definition they're going to cost more - much more - so any savings that were once available to those with higher deductibles is now gone.

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