Those on High-Deductible Health Plans Often Do Without Medical Care

Wednesday, October 21, 2015
(graphic: Chad Baker, Getty Images)

Americans with health insurance that includes high deductibles are more likely to forgo health care than when their health plans have a smaller or no deductible, a new study shows.


Economists Zarek Brot-Goldberg, Amitabh Chandra, Benjamin Handel, and Jonathan Kolstad studied a large company that forced more than 75,000 workers and their dependents from a plan with no deductible to one with a $3,750 deductible. The company also gave employees a $3,750 subsidy through a health savings account to help with healthcare costs they incurred.


The result? Not better shopping, but fewer doctor’s visits.


Average per-patient spending fell 15% from $5,222.60 in 2012 to $4,446.08 in 2013, according to Vox. Other declines were noticeable as well, such as a 25% drop in emergency room spending, an 18% decline in physician office visits, and a 6% decrease in mental health services.


Switching to a high deductible was intended to make people smarter shoppers for their healthcare. “Instead, both healthy and sick patients simply used way less health care,” Sarah Kliff wrote at Vox. “This raises a scary possibility: Perhaps higher deductibles don't lead to smarter shoppers but rather, in the long run, sicker patients,” she added.


“I am a little bit surprised at just how poorly patients were able to do when looking at very similar products, like MRI scans, and with a shopping tool,” Kolstad, an economist at the University of California, said. “Two years in, and there’s still no evidence they’re price shopping.”


The study also found that it was the sickest of those insured who were least likely to go to the doctor, even when it was clear they would soon exceed their deductibles. “People who are the most likely to go past the deductible also cut back by the most, and they did that entirely under the deductible,” Kolstad said. “They respond to the spot pricing [the price of receiving care right then], and that leads to a very large reduction in care. We don’t find any evidence they look for a lower cost. They just don’t go.”

-Noel Brinkerhoff, Steve Straehley


To Learn More:

This Study is Forcing Economists to Rethink High-Deductible Health Insurance (by Sarah Kliff, Vox)

Study: High-Deductible Plans Could Deter Sick from Seeking Care (California Healthline)

What Does a Deductible Do? The Impact of Cost-Sharing on Health Care Prices, Quantities, and Spending Dynamics (by Zarek C. Brot-Goldberg, Amitabh Chandra, Benjamin R. Handel, and Jonathan T. Kolstad, National Bureau of Economist Research) (abstract)

Health Insurance Deductibles Double in less than a Decade (by Noel Brinkerhoff, AllGov)

Healthcare Skin in the Game: Our Skin, Their Game, the Case against High-Deductible Plans (by Steve Straehley, AllGov)

Many Americans with Private Health Insurance Skip Necessary Treatments Due to High Deductibles (by Steve Straehley, AllGov)


Anita Holton 8 years ago
There is no transparency with prices. It's an exercise in frustration to find out prices. I recently tried to price a colonoscopy. The doctor didn't know the cost, the billing office didn't know the price, no one-one could tell me if the anaesthesiologist was in-network or out-of-network or what the cost was to be anaesthetized during the procedure. I had to choose NOT to be anaesthetized. Even without that, my cost was $1800, all of which I had to pay because the guidelines say preventative colonoscopy screenings are only at no cost sharing for people over 50. It doesn't matter that my physician recommended the screening because of a family history of colon cancer. Then, my husband had to have an MRI. I used my insurance's price a procedure tool that told me is should be around $2,000. It ended up being $2,200. What it failed to tell me was that there would also be a $900 additional fee for reading the MRI. Then, I had a cervical cancer screening. I called the insurance to make sure the office visit and screening were covered with no cost sharing. However, what my physician didn't tell me is because I asked a yes/no question unrelated to my screening she changed the billing code to a long office visit and I got stuck with a $177 bill. At this point, with a high deductible plan, the only option available to us, I'm convinced we can't afford health care. On top of $600 per month towards our portion of an employer plan we can't afford another 10k on top of the every year for high deductibles, prescriptions, and co-insurance. Then on top of that there was dental expenses for the year, which were another $2,000.
Ray 8 years ago
The reason people aren't price shopping is because there are no comparisons to be made. A case in point: my spouse was diagnosed with basil cell carcinoma and had 2 options for treatment: MOHS surgery or radiation. Unfortunately after many attempts to get "price" information from the respective doctors or their administrative staffs no one could tell us what either would cost, not even an order of magnitude estimate could be conjured by anyone. At one point with credulity I ask "You've done this before haven't you?" but still no price data. Until prices for services are posted that are specific to the insurance company used and the patients profile and needed treatment you aren't going to see price shopping. Additionally with the tens of thousands of "procedure codes" in the system and a near infinite number of combinations of those codes that can be used in a single "heath treatment event" to derive the final cost you are delusional in your hopes for price shopping in the medical world.

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