Across the country, advocates and legislators have turned the health reform debate away from whether the Affordable Care Act will stay (it will) to how we can deliver quality affordable health care. How can we go beyond the law, reduce cost, remove waste and improve quality. And in the next few weeks an opportunity for working families to advance that will present itself.
This February, the Federal Department of Health and Human Services introduced guidelines encouraging insurance companies to help consumers lower the burden of skyrocketing healthcare costs like doctor’s visits and prescription drugs. A move we at Citizen Action estimate could save working families over $200 million per year in lower medical bills starting next in 2017.
And it is solely needed. Healthcare costs has long risen faster than inflation, but especially for prescription drugs it has been getting worse. Meanwhile, more and more consumers, businesses and families are enrolled in what are considered "high deductible health plans", leaving them at risk for huge financial strain if the worst were to occur. Consumers are even putting off free preventive health services for fear they may accidentally be sent and stuck with a bill they cannot afford.
Which makes these “Low Out-Of-Pocket Health Plans” (known by the technical term "standard plans") so very important. If consumers don't fear a giant deductible they can get the needed doctors visit or prescription to keep them healthy so a small health issue doesn't become an emergency.
Low Out-Of-Pocket Health Plan benefits:
1. Much easier for consumers to compare, they'll be the same for all counties and states where they're offered. No more struggling to determine which plan offers your prescription or doctor
2. Doctor's visits will no longer have a deductible, no matter if they are for primary or specialty care.
3. All prescription drugs will no longer have a deductible either - generic, brand name or otherwise. You'll just have co.-pays or a fraction of the full drug cost
But, there's a problem. The decision whether to introduce Low Out-Of-Pocket Health Plans is completely voluntary. Insurers are not required to offer them, and faced with little price oversight from the Walker Administration's Insurance Commissioner, we believe consumers must be the ones that push back.
In Wisconsin over 239,000 people have signed up for a plan on Healthcare.gov, while estimates are showing that only 33% of people keep the same plan year to year. Meaning a substantial opportunity to reduce the out of pocket costs for consumers willing to switch plans next year.
Citizen Action analysis of all individual Silver health plans (the most common on Healthcare.gov) across Wisconsin show that on average consumers are currently required to pay $3,347 per year in deductibles for doctor visits and other medical services before their insurer pays a dime to help. And while some plans make consumers pay more for prescription drugs up front or instead down the line, the average prescription drug deductible is $1,202 per year.
So, recognizing the tremendous savings possible up front in lower deductibles, we estimate that if only 25% of all people currently using Healthcare.gov in Wisconsin (a fraction of those switching plans every year) instead switched to a “Low Out-Of-Pocket Health Plan”, they would save $200 million per year in lower medical deductible payments, and $71.8 million per year in lower prescription drug deductible payments. All meaning that insurance companies would begin paying claims the moment you had a doctor’s visit or refilled a prescription!
Even if fewer consumers even get the option to enroll in Low Out-Of-Pocket Health Plans, the chance to reduce consumer’s medical and prescription cost burdens by thousands each is too important of an opportunity to pass up!