High-Deductable Insurance and the Access Problem

Could high-deductible insurance control rising health care costs and ensure access to care for more patients? Or does it come with its own problems?

There's something intrinsically wrong with betting on one's health but that's exactly what one does by taking high-deductible (HD) health care insurance. When money's tight it may look like HD plans cost less, but that’s the case only when you're not sick.

The squeeze is on: Employers are taking part-timers so they can avoid paying for health benefits, so even many who are working are uncovered. And, of course, those who are not working are left out in the cold.

Then there was the promising "public option" -- the buy-in to Medicare for those over 55. It would have opened a relatively inexpensive, yet effective program to a whole group of Americans who find it difficult-to-impossible to obtain affordable insurance. The Congressional Budget Office proclaimed it could also improve Medicare's financing by bringing younger, healthier people into the risk pool. (This is called "community" as opposed to "experience" rating). And, since Medicare is here now and quite popular with both doctors and the public, the public option could have been implemented expeditiously.

So we buy a cheaper plan with a big deductible. See "More Americans opt for high-deductible health insurance plans" for more on this topic. The number of people opting for high-deductible plans or who are being forced into taking them by their employers is rising. To keep their medical bills low people are forgoing mammography, colonoscopy, blood, stool, and urine tests (ie, preventive medicine). The consequences can be catastrophic -- patients ending up in emergency rooms or hospitals because they waited too long. It's “penny-wise; pound-foolish.” Forget Health Savings Accounts. Forget going to Mexico for care. Forget perfect attendance at work. And forget credit card interest rates to pay for desperate care in one's hour of need.

What is the leading cause of personal bankruptcy? You guessed it -- it’s the health care crisis.

An MD/PhD colleague of mine offers a dissenting view, believing that “insurance should be for spreading the major costs of illness or accidents, not for the maintenance costs that everyone has. Total Insurance premiums received by the company cannot be less than Total Medical Costs paid out. In fact, they're about 30% higher, because the insurance companies take a cut. That means we all pay MORE in insurance premiums than we would if we just paid our routine medical bills. Good health also depends on good diet. Would we be better off buying ‘food insurance’ and letting the insurance company buy us all of our food? No, because everyone needs food, and it would be more expensive (and more of a hassle) to insert an insurance company into the loop. Exactly the same reasoning applies to routine medical screening and preventive medicine such as vaccinations. Of course, if we had universal, tax-paid health care, that middleman, meddling insurance company stuff wouldn't apply.”

So I ask readers: Would it? In other words, can you manage care well without a middleman?