Chronic Diseases Jack Up Out of Pocket Costs

Individuals enrolled in high-deductible health plans face thousands in out of pocket costs.

With each new year, individuals’ health insurance deductibles reset, which may be frightening for those with a costly chronic disease. Treatments for chronic conditions, such as diabetes, asthma, joint problems, and heart disease tend to be expensive, and affording these drugs may pose a problem for some individuals enrolled in high-deductible plans.

This population may face hundreds to thousands of dollars in out-of-pocket costs, and may surpass their yearly health insurance premium, according to a study published by JAMA Internal Medicine.

In this study, investigators explored the financial consequences of enrolling in a high-deductible plan, which approximately 40% of Americans are covered by. The investigators examined data from a survey of 17,777 Americans under 65 years from 2011 to 2013, prior to the implementation of the Affordable Care Act.

Approximately 4100 individuals included in the survey had a high-deductible plan, and 44.5% had a chronic disease. The investigators then compared out-of-pocket costs for patients with high-deductible plans against low-deductible plans, and costs for patients with chronic disease versus those without chronic conditions.

High-deductible plans were those in which patients pay $1250 for 1 person, or $2500 for a family in out-of-pocket costs. Patients enrolled in these plans are eligible for health savings accounts to use tax-free money for health care costs.

The researchers found that patients enrolled in high-deductible plans are more likely to have health costs that account for at least 10% of total income, according to the study. Interestingly, there is a large variation in out-of-pocket costs for both individuals in high- and low-deductible plans.

However, although these patients face high out-of-pocket costs, relatively few reported that finances or insurance coverage interfered with obtaining the necessary care and prescriptions, but this may not be the case for all patients.

"Increasingly, these plans have become woven into fabric of health insurance in America, so it's important to look at the impact of deductibles on people who need care on an ongoing basis," said senior author Jeffrey Kullgren, MD, MS, MPH. "Not only on how they spend their money on care for their day in, day out health needs, but also how that affects spending in the rest of their lives."

These findings are based on the prevalence of high-deductible health insurance prior to HealthCare.gov allowing individuals to choose their own plans. However, more than 90% of individuals currently choose a high-deductible plan from the marketplaces, according to the study.

Lower-income individuals who enroll in Silver plans likely receive subsidies to drive down the costs, but those who enroll in Bronze plans, with high deductibles and low monthly premiums, are not eligible for this financial assistance. These individuals may not be able to afford chronic disease care.

"A lot of plans, employers and policymakers are using these plans as vehicles to make consumers more active in their care, more cost-conscious, and more interested in optimizing the value of their care. This includes offering price-transparency tools that people can use to see what the care they need will cost, and quality tools to show which hospitals or providers offer the best value,” Dr Kullgren said. "But we don't know yet how often people are using these tools to help them get the care they need and avoid the care they don't need, nor how well the tools serve their needs. We need to focus on helping people who are in these plans use them better."

Currently, investigators are evaluating national survey data from individuals enrolled in high-deductible plans. Dr Kullgren has also partnered with Priority Health to create a price transparency tool that physicians and patients will use together to determine the best treatment decisions based on costs.

"One challenge of high-deductible health plans is that clinical decisions made in a doctor's office are often completely disconnected from the reality of what a patient has to pay out of pocket," Dr Kullgren concluded. "Patients have to decide whether and where to get a service, such as an operation, lab test or medical imaging exam, that they must pay for under their plan. These are decisions where clinicians can help patients navigate -- and in some cases help them avoid care they don't need."