Yes, High Health Insurance Deductibles Are Still A Problem

When the PPACA (‘Obamacare’) was being debated, I noted six years ago that the high deductibles made healthcare no more affordable (in fact, I noted this about Romneycare in 2008). This was not only predictable, but predicted. Which brings us to two items. First, a NY Times report on higher deductibles (boldface mine):

Obama administration officials, urging people to sign up for health insurance under the Affordable Care Act, have trumpeted the low premiums available on the law’s new marketplaces.

But for many consumers, the sticker shock is coming not on the front end, when they purchase the plans, but on the back end when they get sick: sky-high deductibles that are leaving some newly insured feeling nearly as vulnerable as they were before they had coverage.

“The deductible, $3,000 a year, makes it impossible to actually go to the doctor,” said David R. Reines, 60, of Jefferson Township, N.J., a former hardware salesman with chronic knee pain. “We have insurance, but can’t afford to use it.”

In many states, more than half the plans offered for sale through, the federal online marketplace, have a deductible of $3,000 or more, a New York Times review has found. Those deductibles are causing concern among Democrats — and some Republican detractors of the health law, who once pushed high-deductible health plans in the belief that consumers would be more cost-conscious if they had more of a financial stake or skin in the game.

“We could not afford the deductible,” said Kevin Fanning, 59, who lives in North Texas, near Wichita Falls. “Basically I was paying for insurance I could not afford to use.”

He dropped his policy.

As the health care law enters its third annual open enrollment period, premiums and subsidies have been one of the administration’s main selling points…

But in interviews, a number of consumers made it clear that premiums were only one side of the affordability equation.

“Our deductible is so high, we practically pay for all of our medical expenses out of pocket,” said Wendy Kaplan, 50, of Evanston, Ill. “So our policy is really there for emergencies only, and basic wellness appointments.”

Her family of four pays premiums of $1,200 a month for coverage with an annual deductible of $12,700.

Kevin Drum argues this is consumers’ (that is to say, citizens’) fault:

As Sprung tirelessly points out, CSR is only available with silver plans. This makes the bottom line simple: Low-income families trying to buy serious health insurance on an exchange should always buy silver. Bronze is basically catastrophic insurance for 20-something kids who are certain they’ll never use it. Silver is modestly more expensive, but the benefits are worth it, even if you have to scrimp to afford it.

So, like Drum, I went to and played with some numbers. But, unlike Drum, I used older parents (not thirty years old) who earned more ($60,000/yr), and what I found over and over again, is that the estimated total costs for the bronze and silver plans weren’t that different. Given that many people don’t have a lot of money on hand, in that case, rolling the dice and taking a chance is a reasonable decision–after all, the bronze plans do offer a lower mandatory payment. Maybe somehow things will work out. Of course, if things come up snake eyes, you’re screwed.

It’s also worth noting that for Richmond, VA, my hypothetical family of four wound up paying over twenty percent of their income in total estimated healthcare costs. That’s not affordable–and it was obvious years ago, but some pundits, who should have been smarter, were seduced by Obamacare promoters’ professional credentials (John [cough] Gruber).

Yes, Obamacare has been critical for people who were being locked out of the healthcare system due to pre-existing conditions. But for a lot of people, it really hasn’t made healthcare more affordable–or affordable at all.

It’s a complete mystery as to why many people don’t like Obamacare. Maybe people have to like this crap?

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5 Responses to Yes, High Health Insurance Deductibles Are Still A Problem

  1. Brea Plum says:

    The ACA was never about health *care*, it was about health *insurance*. Those are two very different things. If it were about care the administration would have pursued single-payer instead of sacrificing it to the GOP as soon as Obama took the oath of office.

  2. jrkrideau says:

    As a member of a single-payer health care system I have a question, “What’s a health insurance deductable?”

  3. Nocardia says:

    My wife and I had a $5000 deductible $11600 total out of pocket HSA plan through her employer, a medical clinic basically run by specialist doctors. The deductible didn’t worry me as much as the possible out of pocket expense since that was more than a third of our household income. We decided to take early retirement because her employer based insurance was really not affordable. We signed up for a plan on the ACA insurance exchange and it is much more affordable than the employer based insurance. Yes it was a “silver” plan. Sure the ACA could be better but it really is better than the what we had before.

  4. dolphin says:

    …and the thing NOBODY talks about is the clause that says you basically give up your right to privacy — that your medical records can be viewed by Dept. of Hysterical Security. This is a direct violation of the Fourth Amendment, which prohibits government intrusion into one’s private life without a warrant issued by a court.

  5. dolphin says:

    Reblogged this on Dolphin.

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