Vulnerability to High Medical Bills Cited

High deductible health plans (HDHPs) are health insurance plans that try to strike a balance between affordability and usability. With an HDHP, you keep your premiums down by accepting a higher annual deductible, defined as $1,500 or greater for individual coverage and $3,000 or more for a family. However, a recent study by the Kaiser Family Foundation (KFF) implies that those with HDHPs are less satisfied than other health care consumers and are questioning the value of an HDHP.

The discrepancy relates to the overall rating as well as the value. When asked how they would rate their overall health insurance coverage, 66% of HDHP holders rated their care as either “good” (53%) or “excellent” (13%), compared to “not so good” (17%) or “poor” (12%). In contrast, 85% of those with lower-deductible plans rated their coverage “good” or “excellent.” When asked whether their plan provides value for the money, the good or excellent responses drop to 37% for HDHP holders and 68% for those with lower deductibles.

That should be a significant concern for insurers, since according to the KFF survey, 40% of the non-group insurance enrollees have high deductibles. (In a disturbing side note, another 17% were unsure of their deductible, so it’s possible that HDHP numbers are even higher.)

Those with HDHPs tend to have higher incomes, and in general are eligible for fewer subsidies through the exchanges. 37% of KFF survey respondents with HDHPs had incomes below 250% of the Federal Poverty Line (FPL) of $11,770 for an individual and $15,930 for a two-person household in 2015. However, 64% of respondents with lower deductible plans fell into that lower-income category. KFF concluded that only 36% of HDHP holders were likely to receive a tax credit, as compared to 56% of lower-deductible plan holders. Click here to read the full article