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Increasing deductibles? - Printable Version

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Increasing deductibles? - stpioc - 08-26-2016

This turns out to be the next hoax..

4. Even as deductibles in employer coverage have continued their long-term increase, the system-wide out-of-pocket share has declined, indicating that deductible trends are not representative of overall trends in out-of-pocket spending. Many recent analyses of trends in health care spending, including today’s projections, remark on the recent rise in deductibles in employer coverage. In considering the implications of these trends for families’ finances and overall health care spending, it is important to note that trends in deductibles in employer coverage differ markedly from overall trends in out-of-pocket spending. As illustrated in the figure below, the share of total national health expenditures that households finance via out-of-pocket spending has actually declined in recent years. The actuaries project that this decline will continue over the coming decade, reducing the out-of-pocket share to 9.9 percent by 2025.

Trends in deductibles in employer coverage are a misleading guide to the overall trend in out-of-pocket spending for two reasons. First, even for individuals with employer coverage, cost-sharing obligations also depend on plan features other than deductibles, like copayments, coinsurance, and out-of-pocket maximums. While growth in deductible spending has generally exceeded the growth rate of total health care spending in employer coverage during the more-than-decade-longshift toward higher deductibles, a recent analysis found that cost-sharing obligations other than deductibles have risen much more slowly, with spending on copayments actually falling in recent years. (Affordable Care Act provisions that require plans to limit enrollees’ annual out-of-pocket spending and cover recommended preventive services without cost sharing have likely contributed to slower growth in these other categories of cost sharing in recent years.) In fact, the overall out-of-pocket share in employer coverage has been close to flat since 2010, despite the continued increase in deductibles.

Second, focusing on employer coverage misses changes in other types of coverage, as well as shifts in the number of people with insurance coverage and the types of coverage they hold. The Affordable Care Act has driven the latter type of shift in recent years by increasing the number of people with health insurance and helping people that already had health insurance secure coverage that offers better financial protection.
[Image: chart4_NHE_outofpocket.png]

RE: Increasing deductibles? - stpioc - 09-14-2016

The funny thing is, increasing deductibles is just as much a feature of company provided healthcare, which covers vastly more Americans compared to Obamacare. But do you hear the critics about this? Nooo... From Business Insider:


Quote:The main driver of the slowing in premiums, unfortunately, is the rise of high deductible plans, according to Kaiser. In 2016, 83% of workers have a deductible, or amount that they have to pay themselves for medical care before insurance covers it, at an average of $1,478 per worker. The average deductible for workers who have one has gone up $486, or 49%, since 2011.

Additionally, the survey found 51% of workers have a deductible over $1,000, the first time this has happened since the survey began in 1999.
"We’re seeing premiums rising at historically slow rates, which helps workers and employers alike, but it’s made possible in part by the more rapid rise in the deductibles workers must pay," said Drew Altman, CEO of Kaiser, in a release accompanying the survey.

This means that Americans aren't paying too much more on a month-by-month basis, but when they get sick they have to pay more out of pocket costs.

[Image: screen%20shot%202016-09-14%20at%2012.28.26%20pm.png]


RE: Increasing deductibles? - stpioc - 09-21-2016

With all the fuss about Obamacare, consider the following figure:

[Image: NA-CL366_MEDSPE_16U_20160825163913.jpg]

Sure many would instantly point the finger at Obamacare, until you realize the following. 

Quote:About 11 million people are enrolled in the marketplaces. More than 13 times that many, around 150 million, have coverage through employers, and there are 66 million people in Medicaid and 55 million in Medicare.
UnitedHealth leaving the next scare story

We might also provide a bit of the article that accompanies the figure:

Quote:While the political world focuses on the Affordable Care Act, changes have been occurring for the many more Americans who get health insurance through work. The biggest change: rising deductibles, which are transforming the nature of health insurance from more comprehensive coverage to skimpier insurance with higher out-of-pocket costs. This change has happened gradually and has not been the subject of a big legislative debate, as the Affordable Care Act was.

The shift is not a result of Obamacare; the trend began well before the ACA was passed in 2010. The trend is not highly politicized or covered daily by the general news media. All of which contribute to making the changing nature of insurance the most important development in the U.S. health system the public is not debating.

For 18 years, the Kaiser Family Foundation and the Health Research and Educational Trust have done an annual survey of employer health benefits. This year it found that deductibles rose 12% in 2016 in the group market and four times faster than premiums increased. For context, 150 million Americans get coverage through their employers. The trend toward higher deductibles is especially pronounced among employers with fewer than 200 workers, where 65% of employees are now in high-deductible plans. The average deductible in these firms is $2,000.
The Missing Debate Over Rising Health-Care Deductibles - Washington Wire - WSJ

And to put this into perspective, this has been going on for a long time..

[Image: BN-OS459_deduct_G_20160630110112.jpg]


Quote:As the chart above shows, payments toward deductibles by consumers who have insurance through large employers rose 256% from 2004 to 2014; over the same period, wages increased 32%.
The Next Big Debate in Health Care - Washington Wire - WSJ

Again, no Obamacare here, the critics of which routinely denounce it for lousy insurance plans with high deductibles, while completely silent on the much longer rise in deductibles in employer based healthcare (which matters for many more people)..