• Chart: Deductibles in exchange plans

    According to Breakaway Policy Strategies, who analyzed 196 silver-level plans in selected exchanges:

    Average Integrated [Medical + Drug Expenses] Deductible Level

    ave deductibles

     

    Low, Average, and High Deductible Levels for Second-Lowest Cost Silver Plans

    range deductibles

    Even a silver plan can have a deductible well above $4,000. Is that too low? By how much?

    @afrakt

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    • Frakt might have mentioned that the benchmark for subsidies is the second lowest-cost silver plan. So, to answer Frakt’s question, the answer is the deductible is too high, and it’s too low.

    • Definitely think that $4000 is too high, $2000 level in CA probably about right. Have definitely been working on helping people with $10,000 deductible, formally medically underwritten plans. Though there aren’t that many people in this circumstance, there isn’t much that can be done for them.

      If we COULD change the law, I think that we need to make the sliding scale slide a little bit more gracefully. There is an enormous cliff for many at 400FPL depending on price of insurance. Crossing 400FPL creates a marginal tax rate of over 100% …

      • The cliff is ridiculously big in some cases. If I earned 399% of the federal poverty line, I’d be eligible for a $12,000 subsidy. Twelve thousand dollars. If I earned 401% of the poverty line, I’d be eligible for no subsidy.

    • Is that $4,000 per family or per person? It makes a huge difference for a family of four. I had kids with broken legs this year.

    • I always understood that insurance deductibles were to discourage claims for small items/issues.

      Do you really want to be discouraging people from getting health care for “minor” thing?

      I live in a place where there is no deductible. I don’t see people running to the doctor just ’cause it’s free. They invariably have a reason for doing so. Whether or not it’s a good reason might be debatable but the whole reason for going to a doctor is to get expert advice on something you have limited or no knowledge about.

    • My wife’s employer offered a plan with a $4K deductible. However, she wouldn’t be paying anything into the premium and could put that money into a HSA. Her employer was going to put in $1K or $2K for as “seed money” for that account. She opted out of it at the last minute, but won’t have a choice next year.
      I think Ken’s comment is part of the struggle we have with healthcare. In many ways primary care is given at a usually reasonable cost. Should people pay for the reasonable cost out of pocket or should it be free in hopes of prolonging a major health event? On the other hand medical care is a major cause of bankruptcy, a catastrophic illness cause this with a $4K deductible?
      When I worked for an HMO many years ago, I know there where “shock” claims (say for $100K), then another insurer would pick up that claim. Now what they charged was based on the overall age of people in our plan, along with gender type, and types of work along with a few other variables. Now if had a high amount of shock claims for a given year, then they would raise their rates on us, which we would pass along to the people we covered. What I am wondering is if this could be the national health insurance, which is to cover these shock claims?

    • I think Austin’s question is a lot more complicated if you take into account the cost of the premium and whether the insurance is a HMO or PPO plan. The second lowest silver plan is probably a HMO plan with a narrow network that may not work for some people. A typical consumer might be looking at choosing between a HMO plan with a low deductible, low premium, and a narrow network or a PPO plan that covers their current doctor/hospital but has a higher deductible and premium. If changing their doctors and hospital poses a significant problem for them, then the cost of the deductible might be a minor factor in a complicated health care decision.

    • Even a silver plan can have a deductible well above $4,000. Is that too low? By how much?

      I think that it is about $26,000 to low.

      Consider:

      1. Health insurance was invented by providers to avoid having too much uncorrectable accounts receivable.

      2. At $4,000 deductible the maximum uncompensated care $4,000 yet most major health problems (those that need to insured) run much higher than that. My wife’s breast cancer ran $60,000, my business partner’s neck surgery ran $70,000. Both are fine and back working. If we want them to travel to Oklahoma city or Mexico for surgery or if we want their GP’s to shop for price for them we want to them to be able to keep such bills below their deductibles through such methods.

      3. It is unclear why it is better for most patents to prepay for healthcare than to amortize the bills after receiving care.

      4. Most US families amortize home loans greater than $30,000. Some amortize home loans greater than $150,000. Some amortize car loans more than $20,000 in 5 years or less. Health is more important than bigger homes and newer cars. So you opt for the $4,000 car and the 800 SQ FT apartment and amortize your healthcare bill.

      5. It might in the long run cause hospitals to do more followup on patents to keep the patients in good enough shape to work so they can pay the bills.

      6. If you are really poor and cannot amortize the bill you will be on medicare anyway.

      7. If you remain too sick to work perhaps the hospital should stiffed so they are motivated to get you in working shape.

      8. If you remain too sick to work you will fall onto SSDI and Medicaid with or without a high deductible.