For thrifty consumers, there’s a lot to like in high-deductible health insurance. The plans offer low monthly premiums and those fees fully cover preventive care, including annual physicals, vaccinations, mammograms and colonoscopies, with no co-payments.
The downside is that plan participants must pay the insurers’ negotiated rate for sick visits, medicines, surgeries and other treatments up to a minimum deductible of $1,500 for individuals and $3,000 for families. Sometimes deductibles are much higher.
Let’s keep it civil.
These are smart plans. They usually come with an HSA and most employers contribute to it. Combined, it means for me I never come out of pocket for healthcare costs. But it also means I can negotiate cash prices with providers when it makes sense and purchase health related products and services with tax free money without getting pre-approval or talking to an insurance company.
I think the HSA is a big attraction for the GOP - tax advantaged encouragement to get more people investing more money in stocks. Practically, though it also means more people effectively self-insuring. My deductible is $6500, but I’m allowed to put $3500 into HSA, so 2 years’ HSA savings covers the deductible. Fine, for individuals that are reasonably healthy, but it reduces the pool of money that insurers have to pay benefits to people who do have claims.
Essentially incentivizing individuals to sabotage the system.
I’ve not had a HDHP with a higher deductible than the annual HSA max (for my family), but I agree if you end up in that boat it’s just self insuring for smaller claims which is frustrating. I think there should be a max deductible on the plan that matches up with the HSA max contribution so there’s not a self insuring gap.
But I think there are benefits to having control of my smaller, regular healthcare purchases. I don’t need approval to go to physical therapy, and I can buy over the counter stuff, eyeglasses, etc. without asking Anthem, Cigna, or Huamana for permission. So I favor the plans that bring control to consumers as long as they don’t leave people with big coverage gaps.
The best time to negotiate your medical care is in the emergency room!
But HDHP plans cover you for catastrophic issues. The only gap is paying the deductible which is no problem if you have a funded HSA.
For instance, if you go to the hospital and get a $50k bill.
Now you may also have worse coverage.
I agree the second kind of plans should be restricted, but they are the more affordable ones. But being able to negotiate for smaller issues and being covered for catastrophic ones by insurance is the way we handle most other things.
For instance, you handle your own oil changes, car washes, and tire rotations. Insurance only steps in when you wrap the car around a tree. If those services were all included, car insurance would skyrocket.
Car insurance is to pay for the damage your accident does to other people. You probably have the optional coverage that also pays for damage to your own car, but that’s not why insurance is legally required. You can get repair insurance, but it’s generally ‘not worth it,’ because no one gets it, leading to a small premium pool and minimal risk spread. Kind of like low premium, high deductible plans do for health insurance.
Car insurance that was universal would set maintenance prices in a way that was cheaper than paying on your own, as proven by every single payer country in the world.
You think that because you are wheeling and dealing that you are getting a good deal, but that is just the impression they want you to have. Countries with single payer or comparable universal medic coverage spend far less (like 6k a year on average) and people pay proportional rates based on income. That isn’t what they pay in taxes, that is the cost averaged out an includes cancer patients and is far lower for lower income earners and higher for high income earners.
You have fallen for the desire to have choice over a working system that benefits everyone and most likely would cost you less.
Wouldn’t a fair amount of people *not *have a funded HSA? The savings power of Americans is not so great; it seems logical to me that a good percentage of people choosing low premium/high deductible plans are doing so because they already can’t afford a large monthly expense, not because they’re flush with cash to fund a savings account.
It sounds like you are able to fully fund your HSA, so it works out great for you, but I’m not convinced that would be the case for most people on these plans.