The True Consequences Of So-Called Consumer Driven Health Care
The True Consequences Of So-Called Consumer Driven Health Care
In today’s Wall Street Journal, Robert Carroll lays out the conservative philosophy for health care reform. Like Sen. John McCain, Carroll believes that the employer-insurance subsidy contributes to higher health care costs by encouraging overutlilization of care. “The subsidy encourages people to buy bigger policies that cover more, and leads to greater health-care spending,” Caroll argues.
Eliminating the income-tax exclusion “should reduce private health-care spending; to the extent this reduced the cost of health care, it should also put downward pressure on the growth of Medicare and Medicaid costs.”
But in shrilling for McCain’s plan to dismantle the employer-based system and push Americans into high-deductible plans in the individual market, Carroll gets the consequences of leaving individuals responsible for financing their own health care entirely backwards.
According to a Commonwealth study, for instance, the major effect of a high deductible is likely to be “a one-time shift in spending from premiums to patient out-of-pocket outlays.” Premiums to employers and workers would be reduced by 10 to 15 percent, “but most of that reduction would be a reduction in covered medical outlays and a shift to out-of-pocket expenses for which patients would be responsible,” a Commonwealth study concluded.
Shifting the risk and cost of health insurance onto the individual will increase medical debt and discourage preventive care utilization. In fact, adults enrolled in high-deductible insurance plans (with deductibles of $1,000 or more) reported one of four cost-related access problems:
- because of cost did not fill a prescription- did not see a specialist when needed
- skipped a recommended test treatment, or follow-up
- had a medical problem but did not see a doctor
Encouraging more people to skimp on preventive care, could fuel growth in health care spending, not reduce it. In fact, advocates of so-called consumer driven health care plans, miss the forest for the trees. The sickest 20 percent of Americans account for 80 percent of health care costs. Yet consumer plans would do little to lower the costs of their care and may actually add to their ranks.
Carroll proclaims that “Almost Everyone Would Do Better Under the McCain Health Plan.” In truth, it’s difficult to think of anyone — the not-yet sick or the already sick — who would benefit from punting needed care because of higher cost.
2 Responses to “The True Consequences Of So-Called Consumer Driven Health Care”
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Where has Bob Carroll been the last twenty years as employers raised deductibles, copays and premium sharing? He sounds like Al Hubbard, who most recently guaranteed a good outcome from implementing the Wall Street bailout.
The government lies about the number of people with funded health savings accounts. Treasury uses the number of people covered by high deductible health plans, not those with actual money in an HSA.
The McCain plan is driven by American business interests, who dearly want to dump that employer health insurance benefit.
It would give CEO’s a nice shot in their executive incentive compensation. I don’t think many other Americans will truly benefit.
October 27th, 2008 at 1:54 pmFirst of all, The Commonwealth Study referenced above was based on data created at the end of 2003, suggesting that some of it was generated even before HSA legislation was passed in December 2003. HSAs were brand new and CDH education limited. HSAs and CDH has grown significantly since 2003 and I wouldn’t hang my hat on any of The Commonwealth data.
Let’s take a look at current usage of Consumer Directed Health for a moment. Research conducted this year by The Blue Cross Blue Shield Association and presented October 20th, 2008 at the National Consumer Directed Healthcare Summit, entitled Health Plan Initiatives, Trends & Research in Consumer Driven Care reported the following attributes of their HSA eligible members (and BCBS has thousands and thousands of them) as compared with their non-CDHP Enrollees.
HSA eligible enrollees:
-want more control over their healthcare costs
-are more cost conscious and cost driven
-are more engaged in tracking their healthcare expenses (current and future)
-are more engaged in health screenings, exercise, nutrition and health coaching
-use more preventative services
-use JUST AS MUCH necessary services as non-CDHP enrollees (in otherwords, they don’t skimp on services like in/out patient procedures, diagnostic imaging and ER visits as has often been argued by those who do not understand or support an individuals right to be responsible for themself)
What I take away from this research is that individuals with CDHPs get ill less often, and when they do get ill, they tend to use the healthcare system more responsibly. Less usage and more responsible use not only drives their costs down for the member but for all of us. Seems like a good thing to me.
For the actual BCBS presentation including the supporting stats, please see: http://www.bcbs.com/news/bluetvradio/consumerdriven2008/bcbsa-final-slides.ppt
October 28th, 2008 at 6:49 pm