Archives of Internal Medicine
November 22, 2010
Health Care Use and Decision Making Among Lower-Income Families in High-Deductible Health Plans
By Jeffrey T. Kullgren, MD, MPH; Alison A. Galbraith, MD, MPH; Virginia L. Hinrichsen, MS, MPH; Irina Miroshnik, MS; Robert B. Penfold, PhD; Meredith B. Rosenthal, PhD; Bruce E. Landon, MD, MBA; Tracy A. Lieu, MD, MPH
From the Introduction:
In early 2009, 23% of all nonelderly adults with private insurance, and nearly 50% of adults who purchased coverage through the nongroup market, were enrolled in an HDHP (high-deductible health plan). Because of their relatively low premiums, HDHPs are also playing a prominent role in expanding insurance coverage. For example, most individuals who have purchased unsubsidized plans through the Commonwealth Connector, the new health insurance exchange in Massachusetts, have selected products like HDHPs that offer low premiums with high levels of cost-sharing.
As enrollment in HDHPs has grown, many analysts have voiced concerns about the impact these plans may have on low-income families. Decades of health services research have demonstrated that higher levels of cost-sharing reduce health care utilization, sometimes with greater adverse consequences for low-income patients.
From the Comment:
We found that lower-income families with at least $500 in annualized out-of-pocket expenditures in an HDHP were more likely than higher-income families to delay or forego health care services owing to cost (57% vs 42%).
Overall, we observed relatively high rates of delayed or foregone care in both income groups, with nearly half of all families having either delayed or foregone care in the last 6 months owing to the cost. These rates were substantially higher than the 20% of the US population reporting either unmet need or delayed care in the previous 12 months in the 2007 Heath Tracking Household Survey.
Beyond the implications for clinicians, our findings have important implications for federal health reform. Reform legislation that establishes an individual health insurance mandate could lead more families to enroll in plans with high levels of cost-sharing, as has been seen following the implementation of coverage mandates in Massachusetts.
The New York Times
November 22, 2010
Higher Deductibles, Lower Spending
By Reed Abelson
As more families find themselves enrolled in health plans with high deductibles, they are increasingly likely to delay or forgo medical care because of the out-of-pocket cost, a new study shows (the study cited above).
Do you think people are better and more savvy consumers when they share in the cost of their medical care?
Three reader responses:
12. Anonymous BE, Belgium
November 23rd, 2010
NO. Medical care should be free at the point of service. The whole point of health insurance is that no one should be financially worse off because they have health problems. High deductible plans violate this maxim.
Furthermore, people are not in a position to judge what is necessary or not. People listen to what their doctor says, and they do it, unless their lack of insurance coverage makes it a financial problem. Patients are not evaluating the effectiveness of various treatments - that is a job for doctors and scientists, not patients. Patients are not consumers - they are people who are suffering who place themselves in the hands of the medical profession.
13. GoozNews, Washington, DC
November 23rd, 2010
RE: eliminating useful v. non-useful care via higher co-pays. It's not an open question. The Rand Health Insurance Experiment, the only comprehensive study to date, showed that people were just as like to avoid necessary car as unnecessary care when forced to pay higher co-pays and deductibles. This is also common sense. When the quality of a good, in this case health services, has no relationship to price, and consumers lack accurate and timely information about what constitutes high quality, making rational decisions based on price is virtually impossible. It requires extensive research prior to the point of purchase -- highly impractical when it comes to health care, which is usually purchased under the duress of immediate illness. Those who advocate "more skin in the game" as the cure for rising health care costs fail to acknowledge these all-too-human realities, or what an economist might call pervasive marketplace failures.
23. Don McCanne, San Juan Capistrano, CA
November 23rd, 2010
What really matters is our total national health expenditures. We are already spreading the risk by contributing to our public and private insurance pools through taxes and/or premiums. So we should decide whether the financial barriers to care that high-deductible health plans create are worth the projected savings in our total health care spending.
Only one-fifth of us use four-fifths of all health care. For this sector of our population, deductibles are rapidly exceeded and have virtually no impact on total national health care spending. (It is in this sector where most of the Dartmouth variations occur, but that is another topic.)
For the four-fifths of us who are relatively healthy, most of us would not decline clearly appropriate care even if it is below the deductible, providing that we had the ability to pay for it. Only the worried-well, perhaps with a common cold, might use the health care system more than necessary, but that doesn't apply to most of us.
Although the trip to the doctor is almost always for legitimate reasons, perhaps ten percent of the time the marginal care offered might reasonably be declined, providing it is an informed decision. Studies show that about half of that care is still appropriate, so only five percent of care for healthier patients may be of no more value than receiving reassurance that no care is needed (which actually does have value in itself).
Since the four-fifths of us who are healthy consume only twenty percent of total health care, the five percent of our care that might deemed to be inappropriate constitutes only one percent of our national health expenditures (five percent of twenty percent). That one percent is the equivalent of only two or three months of health care inflation - not worthy of more than a footnote in our national health care budget.
We can control health care costs, but high-deductible health plans are not an effective mechanism. They certainly are not worth the price of denying beneficial care based on individual concerns over affordability.
Every other nation has controlled costs by establishing an effective model of social insurance. Unfortunately the model in the Patient Protection and Affordable care Act falls far short. What would work would be to improve the Medicare program and then include everyone. Several studies have shown that it would be the least expensive method of providing affordable care for absolutely everyone.
Comment: This study of the impact of high-deductible health plans is unique in that it studied only families with over $500 in annual out-of-pocket medical expenses, thus they are families that do have some interaction with the health care system.
It is no surprise that 57 percent of these lower-income families with high-deductible health plans delayed or had foregone health care. What is less intuitive is that 42 percent of the higher-income families with high-deductible health plans also delayed or had foregone health care. Other studies indicate that about half of that care would have been beneficial, so we really should question the policy of using high-deductible health plans as a method of containing health care costs.
Another important concern is that individuals purchasing plans from the Massachusetts health insurance exchange are choosing high-deductible plans because of the lower premiums. The state exchanges to be established under the Patient Protection and Affordable Care Act will offer low-actuarial value plans as the standard. These plans are high-deductible plans that will likely attract most buyers. Bad policy.
When the evidence so clearly indicts high-deductible plans, why did Congress adopt them wholesale? Simply to accommodate the private insurers in preserving their markets by trying to keep their premiums affordable (which they're not anyway).
It's time to dump the private insurers and establish an improved Medicare for all, with first dollar coverage. We can control costs far better with the other single payer tools that would be at our disposal.