High deductibles threaten affordability of ACA coverage

Though insurers and the government strive to keep premiums low, the increasing prevalence of high-deductible health plans jeopardizes the affordability of many individual exchange plans.

In its enrollment push for the ACA's third open signup period, the federal government has emphasized availability of subsidies that help consumers afford premiums, saying 72 percent of current marketplace enrollees can find a plan for $75 or less per month, and 78 percent can find one for $100 per month.

Yet a New York Times review found that in many states, more than half the plans available on the Affordable Care Act's online federal marketplace have a deductible of $3,000 or more, according to the publication. The Internal Revenue Service, the article notes, defines a high-deductible plan as one with a deductible of at least $1,300 for an individual plan or $2,600 for a family plan.

The prevalence of high-deductible plans represent a "degradation of health insurance," Sara Rosenbaum, a professor of health law and policy at George Washington University, tells the Times, adding that insurers designed plans this way to hold down premiums and attract lower-income consumers on the exchanges. For comparison, the average annual deductible in employer plans is $1,320 for individual coverage, the article notes, citing Kaiser Family Foundation data.

The ACA does require plans to pay for certain preventive services without a deductible or copay, and does limit out-of-pocket costs for consumers. Yet even with these protections, exchange plans' high deductibles cause some consumers to decide they can't afford insurance after all, according to the Times. One woman told the publication she believes she's better off saving up for a catastrophic health event than purchasing coverage.

And for those who do stick with their plans, high out-of-pocket costs can lead individuals to delay seeking care--which nearly 30 percent of adults with deductibles of at least $1,500 per person did in 2014. And for insurers, providers and consumers alike, this can lead to higher costs down the road.

To learn more:
- read the Times article

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