The latest Kaiser Family Foundation survey of employer health benefits concludes that “workers are shouldering higher health care costs as more employers demand bigger out-of-pocket payments from employees before their insurance kicks in.”
According to the survey of 1,927 employers, “annual deductibles — the amount employees pay out of their own pockets for medical care before their insurance coverage starts — jumped an average of 29%, to $1,344, for those with family coverage.” “This is partly, but not entirely, driven by growth in consumer-directed plans such as those that qualify for a tax-preferred Health Savings Account,” the study concludes.
Consumer driven health care plans do increase out-of-pocket expenses. “We may be seeing the tip of the iceberg toward less comprehensive, skimpier coverage,” Kaiser President Drew Altman warned.
But under Sen. John McCain’s (R-AZ) proposed health plan, too many Americans may actually hit the iceberg. As a recent study published in Health Affairs points out, McCain’s plan would push more Americans into the unregulated individual health market place. But, since “it is much more expensive to sell insurance to millions of individuals,” a family that moves from the group to the individual market will experience higher costs:
The typical deductible in nongroup plans is about $2,750, compared to about $1,000 for group policies. Coinsurance rates average 26 percent in nongroup plans, compared to 20 percent in a typical employer-based plan. For plans with copayments, the average copayment in the nongroup market is between $30 and $40 per doctor visit, well above that of group plans. Many services are not covered at all. Thus, much of the apparent savings from shifting to nongroup coverage would be offset by higher out-of-pocket costs for care.