Minimizing the negative effects of high-deductibles

Most payers and employers now offer high-deductible health plans (HDHPs), but questions remain regarding how those plans will impact hospital revenue.

HDHPs are health insurance plans with fairly low monthly premiums, but relatively large out-of-pocket expenses for incurred medical care. Typically, deductibles range from $500 to $6,000, depending on benefit design and household size. Members are responsible for the cost of care incurred up to the deductible limits within a given year.

These plans are exceptionally efficient vehicles for constraining health costs to all purchasers: insurers, employers, and patients alike, says Christopher Kerns, MBA, managing director, Research and Insights, The Advisory Board Company. And, for patients who can’t afford traditional health insurance premiums, HDHPs are a low-cost option.

But Amelia M. Haviland, PhD, Carnegie Mellon University, says hospitals may face increased pressure to be more transparent because of the increasing number of patients with high deductible health plans (HDHPs).

“In the past hospitals had to address unpaid bills-mostly of the uninsured-partly by getting such patients signed up for Medicaid where applicable," she says. "With insured patients now paying more out of pocket, they need to figure out strategies for getting paid not just by insurers, but also by patients, and sort out what to do if they can’t pay. Even though more patients may have insurance, they may not have enough savings to pay their high deductibles.”

Kerns, MBA says more hospitals and providers may consider providing more low-cost options due to the increasing number of high-deductible plans. “Most health systems are mission-oriented organizations, and have no desire to squeeze patients who truly can’t afford their care as a result of high out-of-pocket expenses,” Kerns says.

More and more organizations are revising their so-called sliding-scale policies, where the price of care is moderated by overall household income. This financial assistance becomes a form of charity care, which nearly all hospitals provide.