Republicans seem intent on pursuing a disastrous Obamacare replacement plan that couples catastrophic coverage with subsidized health savings accounts.
Such high-deductible plans will make achieving good health much harder for patients. They will raise uncompensated-care costs and thus everyone's rates. And they will undermine the system's efforts at delivering better, more cost-effective care.
Whether Republicans implement this alternative in three months or three years, the bottom line will be people paying more out of pocket. Preventive medicine and chronic disease management will get thrown under a bus filled with price-sensitive, ill-informed consumers left to their own devices to figure out what to buy in an overpriced and opaque healthcare marketplace.
It is the height of irony to listen to leaders like Rep. Kevin Brady (R-Texas), chairman of the House Ways and Means Committee, rail against Obamacare for delivering plans where the “deductibles—the out-of-pocket costs people must pay before their insurance benefits kick in—have become so high many Americans feel like they don't have coverage at all.”
That's exactly what congressional Republicans' preferred alternative offers. Giving a tax credit for the purchase of largely unregulated insurance policies sold across state lines will inevitably drive most families without employer coverage to plans with very high deductibles since that is all they will be able to afford.
It's Economics 101. People without much money care about price. It was true for the sizable number of Obamacare plan purchasers who chose bronze-level plans. And it will be true in this alternative insurance marketplace unless Republicans are willing to offer subsidies comparable to those under Obamacare.
To see the impact that high-deductible plans are already having on the health of the American people, look no further than the nearly 60 million Americans in such plans now. Only half of those plans offer an HSA, and not all employers make a contribution to those accounts.
A recent Employee Benefit Research Institute study found HSA-eligible health plans reduced patients' office visits across the board. The decline was twice as large for workers and their dependents with incomes below $50,000 compared to workers with incomes above $100,000.
When compared to higher-income workers, people earning below $50,000 in high-deductible plans filled fewer drug prescriptions, used fewer preventive services and received fewer influenza vaccines. Another study by the same group, published in the American Journal of Managed Care, found medication adherence by patients with hypertension, diabetes, depression and dyslipidemia fell in every income group.
Yet these very same price-sensitive consumers increased their emergency room visits and had higher inpatient hospital admissions. That's what happens when patients with multiple chronic diseases go off their meds.
Perhaps Republicans don't care what happens to the voters who put them in office. (Let's not forget the majority of people who purchased Obamacare plans are white and virtually all the subsidies go to people in the lower tax brackets.) But you'd think they would at least care about their own pocketbooks.
Ending Obamacare and shifting more people into high-deductible plans will dramatically increase the uncompensated-care costs at U.S. hospitals and physician offices. Those unpaid bills declined dramatically in the past few years and played a big role in keeping overall employer premiums in check. Uncompensated-care costs are routinely passed along in the form of higher insurance rates.
Reverse that trend and it will increase the pressure on employers to put even more of the 155 million Americans with employer-based coverage into high-deductible plans, since that's the easiest way to hold their costs in check. The downward spiral will accelerate.
Healthcare leaders and employers need to join hands and speak out against this disaster in the making.
