That, he noted, runs counter to predictions that the rise of the Affordable Care Act public exchanges would destabilize the employer-based insurance market. But despite using fewer medical services overall, they personally paid more out-of-pocket costs each year. The Kaiser data shows that while premium increases have moderated – with family premiums growing an average of three percent past year – many employers have increased their use of high-deductible plans, and the deductibles themselves have also skyrocketed.
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But Anderson says high deductibles raise troubling issues as well.
Deductibles are what consumers pay out of pocket before the insurance kicks in. Still, it is low-income workers who are most likely to opt out of employer-provided insurance and to postpone care that they have to pay out of pocket for, Pauly says.
But the double-digit increase predicted for many Obamacare plans isn’t related to the rising cost of healthcare – it’s largely because insurers initially priced their plans too low.
It also saves employers money.
High-deductible plans have been growing in popularity in recent years, as employers seek to shift more of the cost to their staff and keep premium increases at bay. Family coverage premiums have climbed a total of 20 percent over the last five years, while worker earnings have risen 11 percent and inflation has climbed 6 percent, Kaiser reported. Deductibles have risen even more.
Employers do tend to favor high deductible health plan coupled with a health savings account that workers and employers can contribute pre-tax dollars to, the survey found. Health care attorney Nancy Taylor, who represents many large employers including restaurant companies, says companies are also increasingly rewarding people for participating in wellness screenings and programs and contributing money into their HSAs when they do so. The annual window in which employees can enroll in their company’s insurance for 2017 or make changes to their coverage begins in November for many companies. Only 2 percent said they were switching full-timers to part time to make them ineligible.
The trend offers some relief to both employers and workers.
Single workers at small firms are especially taking a hit, Kaiser said, as their annual deductibles averaged $2,069, compared with $1,238 for the large companies.
She says the company offsets some of that deductible by putting cash into accounts that workers can use for health care costs. Even prices for basic procedures such as radiology scans often arent easily known beforehand.
That’s of less concern to Pauly, as he says the limited research in the area suggests this doesn’t happen, but he still thinks high-deductible plans shouldn’t even be available to low-ncome people.
“Deductibles are difficult for people because the full cost can sometimes be hard to pay”, said Gary Claxton, who oversees the Kaiser survey. But its a much broader phenomenon.. And for the first time, according to the survey, slightly more than half of all covered workers have deductibles of at least $1,000, and at smaller firms, the average deductibles now are above $2,000. People on the high-deductible plans spent an average of $1,030 out of pocket on health care, vs. $687 by people in more traditional plans. Yet deductibles are just one piece of the health insurance spending story.
“If government thinks they’re a good idea why shouldn’t they?” says Pauly.
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Consumers on high-deductible plans from 2010 to 2014 used 13 percent less inpatient hospital care, 10 percent less outpatient care and 13 percent fewer prescriptions compared with those with conventional insurance including a 21 percent reduction in use of brand-name drugs.
