You can’t be a smart shopper if you can’t dictate a price. The fact is with an HDPD you don’t have bargaining power and refusal to pay an entire bill like the insurance company does. If a consumer has a way to battle frivolous charges from a doctor or hospital then it has a chance to work.

Good, maybe he will actually price things what their worth when a lot of people start coming in. I know several people who just tell the hospital they have no insurance when they have a high deductible plan. Saves then 80%. I don’t do it, but I hear people laughing about all the time.

The big issue is that patients will start toughing it out instead of paying ( bargain shopping as it’s called by non-high deductible employees ). I never checked out my stomach and with a history of cancer I will probably find out I have stage 4 cancer again next year.

In other words, high deductible is survival of the richest. Until the health industry gets a lot of regulations, doctors will bleed employees dry of their wallet.

it is high time that someone provides solid actuarial proof that the Republican litany of “more skin in the game” is so much baloney!

Bob –

This defies common sense. Experts have told me in the past that if you take the first $5,000 of medical claims incurred by an insured population, including the first $5,000 for the very expensive cases, it would amount to between 25% and 33% of total medical claims and probably closer to the lower end.

Presumably, insurers expect to earn the same profit margin from its high deductible and low deductible plans and should price them accordingly. Under PPACA, insurers must spend at least 80% of premiums for medical claims with a maximum of 20% left to cover administrative costs and profit (15% for large groups). If a $5K deductible would only lower projected medical claims for an insured population by 25% vs. a low deductible plan and medical claims account for 80% of premiums, then the price difference between the high and low deductible plans can’t exceed 20% and could easily be as low as 15%.

When I was pricing Medicare supplemental plans last year, if I remember correctly, the premium difference between the $2,000 deductible Plan F policy and the zero deducible was $800 per year at most. No insurer in its right mind would offer a premium discount for a high deductible policy that exceeds the incremental deductible over the more comprehensive plan.

For a premium of $650 a month, they could get a policy with a $4,050 deductible.

For a premium of $360 a month, they could get a policy with a $14,200 deductible.

Several thoughts come to mind–

a. on the latter policy with the huge deductible, I assume that the insurance company makes out like a bandit. They will almost never have to pay a claim.

b. This sure was not what the early advocates of high deductible coverage had in mind. The selling point for the John Goodman/Heritage crowd was that you could take your premium savings and use that to fund your HSA.

In his libertarian book The Cure, David Gratzer used an illustration where the premium would drop from $8000 a year for low deductible policy down to $3,000 for a $2500 high deductible policy……I could go for that myself!

What has happened here? I would be curious as to any answers.

It is no different than food or cars.

A person whose income is $2000 a month can afford about $150 a month for health insurance. Go on any health insurance website, and the only plans available for that amount will have very high deductibles.

The ACA has a million imperfections, but one thing to its credit was that it at least acknowledged the inadequacy of the free market. If the ACA subsidies survive, then the person making $2000 a month will pay $150 and then the government will ADD another $500 a month so that this person can afford a decent policy.

I just shake my head when I read what Republicans say about the current state of affairs. To a large extent, Republicans only talk to seniors or to well-connected corporate employees or to entrepreneurs who make far more than $2000 a month. If those are the only people in your universe, then the scandal of mis-placed high deductible plans is not on your radar.

Dick Armey is the poster child for this studied ignorance, Read his comments on health insurance any time for confirmation.

Don’t know who sells them. I agree, they don’t work at all if you don’t have a lot of money.

Who’s selling these plans? Sounds like the health insurance equivalent to predatory lending.

That’s how I see these plans, great for financially secure people but a joke for those people without enough disposable income to make the plan work for them. I have a HD home insurance policy, but I have ample resources to cover an initial loss.