CREDIT: Jessica Rinaldi/Reuters
The Wall Street Journal’s Leslie Scism and Timothy W. Martin write that consumers purchasing health care coverage through the Affordable Care Act’s new health care marketplaces are “encountering a troubling element of the federal health law.” Insurance policies with low premiums — so-called bronze-level plans — often come with higher deductibles, leaving some unable “to afford the portion of medical expenses that insurance doesn’t cover.” Therefore, consumers face “a difficult trade-off: They can pay significantly higher premiums for the exchange’s silver, gold and platinum policies, which have lower deductibles, or gamble they won’t need much health care and choose a cheaper bronze plan.” Here is the rub:
The average individual deductible for what is called a bronze plan on the exchange—the lowest-priced coverage—is $5,081 a year, according to a new report on insurance offerings in 34 of the 36 states that rely on the federally run online marketplace.
That is 42% higher than the average deductible of $3,589 for an individually purchased plan in 2013 before much of the federal law took effect, according to HealthPocket Inc., a company that compares health-insurance plans for consumers. A deductible is the annual amount people must spend on health care before their insurer starts making payments.
Likening plans available in the old individual market to the new more comprehensive policies that are offered through the exchanges doesn’t make for an apples-to-apples comparison, even if the trade-off is still very much the same. Insurers and employers have long sought to deal with increasing health care spending by shifting costs to the individual in the form of ever-higher cost sharing, leaving many families in financial distress. A Kaiser Family Foundation survey found that over the last six years, the number of workers covered by high-deductible plans “has quadrupled, from 5 percent in 2007 to 20 percent” in 2013.
The ACA won’t end this trend, but does cap out-of-pocket spending at $6,350 for individuals and $12,700 for families of four. Americans who earn up to 2.5 times the poverty level will also qualify for “cost-sharing” subsidies in silver-level policies that are purchased through the law’s new health care marketplaces. For the first time, consumers will also be able to easily compare different levels of coverage and standard benefit packages with their eyes open, free of insurer malfeasance. And as always, they will have the choice of a vast array of policies all at different price points.
But since there is no silver bullet to instantly lower health care costs, buying health care will still be filled with tough decisions and tradeoffs — those aren’t going away any time soon. Now, they will become easier and fairer for the consumer.