By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    stress management for healthcare workers
    3 Tips For Healthcare Professionals: How To Stay Beautiful, Healthy, and Happy
    November 2, 2021
    importance of relaxing on the weekend for your health
    Importance of Relaxing During the Weekend for Optimal Health
    March 25, 2022
    LASIK Eye Surgery
    What Is LASIK Eye Surgery?
    May 16, 2022
    Latest News
    7 Most Common Healthcare Accreditation Programs: Which Should You Use?
    August 20, 2025
    Hospital Pest Control and the Fight Against Superbugs
    August 20, 2025
    Hygiene Beyond The Clinic: Attention To Overlooked Non-Clinical Spaces
    August 13, 2025
    5 Steps to a Promising Career as a Healthcare Administrator
    August 3, 2025
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    New Study Challenges Current Notions of Breast Cancer Biopsy Abnormalities
    February 5, 2014
    Health Insurers are Feeling the Pressure of Looming PPACA
    August 30, 2012
    demographics bar graph
    Demographics of CDHP Enrollees
    May 8, 2014
    Latest News
    How Social Security Disability Shapes Access to Care and Everyday Health
    August 22, 2025
    How a DUI Lawyer Can Help When Your Future Health Feels Uncertain
    August 22, 2025
    How One Fall Can Lead to a Long Road of Medical Complications
    August 22, 2025
    How IT and Marketing Teams Can Collaborate to Protect Patient Trust
    July 17, 2025
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: The Folly of High Deductible Health Plans
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Business > Finance > The Folly of High Deductible Health Plans
BusinessFinancePolicy & Law

The Folly of High Deductible Health Plans

DavidEWilliams
DavidEWilliams
Share
3 Min Read
SHARE
value-based pricing!

Now that’s what I call value-based pricing!

value-based pricing!

Now that’s what I call value-based pricing!

They used to call high deductible health plans “consumer-directed” plans. That was before people realized there is nothing particularly consumer driven about them. A recent poll –not the first of its kind– shows that people with high deductible plans tend to forego care. In fact they skip both unneeded and needed care. Most people don’t like the plans so much when they get sick.

Naturally the current negativity about high deductible plans is mixed up with discussion of the Affordable Care Act, aka ObamaCare. The lowest tier Bronze plans have cheap premiums but high deductibles. This very typical article on the subject (Skipped Care A Side Effect Of High-Deductible Health Plans) from the Seattle Times comes complete with the requisite Republican representative trashing ObamaCare. What this article and almost all similar ones miss is that low income people should purchase Silver tier plans. Not only will they receive valuable premium subsidies, they’ll also be eligible for cost-sharing subsidies that reduce out-of-pocket costs, thus neutralizing the usual criticism of ObamaCare. (By the way, details like this are why the law has a lot of pages in it.)

In the private sector things are different and worse. Employers that offer high-deductible plans are effectively penalizing their low wage employees and rewarding those with high incomes. That’s because those with limited incomes are more sensitive to the high out of pocket costs. They’ll self-ration and hold overall medical expenses down. Meanwhile, high wage employees won’t be nearly so affected. High income people I know who have high deductible plans just don’t think hard about avoiding the out-of-pocket payments. Their premiums will be lower than they should be because utilization is held down among the lower wage folks on the same plan.

Meanwhile, the high deductible plans are totally ineffective at cost containment once the relatively low out-of-pocket maximums are reached. For example, anyone having even minor surgery will blow right through the maximums and have no incentive to keep a lid on costs after that.

A better approach would be to offer policies that reward patients for using efficient providers and provide a premium rebate to those who do.

photo: theamericanroadside / photopin cc

Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

engineer fitting prosthetic arm
How Social Security Disability Shapes Access to Care and Everyday Health
Health care
August 20, 2025
a woman explaining the document
How a DUI Lawyer Can Help When Your Future Health Feels Uncertain
Public Health
August 20, 2025
physiotherapist at work
How One Fall Can Lead to a Long Road of Medical Complications
Health care
August 20, 2025
Common Healthcare Accreditation Programs
7 Most Common Healthcare Accreditation Programs: Which Should You Use?
Health News
August 20, 2025

You Might also Like

telemedicine
BusinesseHealthTechnology

5 Fun Healthcare Tools to Help Build Patient Relationships

March 11, 2014
Specialty Pharmacy
BusinessFinanceSpecialties

The ABCs of Specialty Pharmacy

November 12, 2014

The PCMH and Home Care Data: An Interview with Melissa McCormack

December 19, 2013

11 Social Factors That Contribute to Higher Readmissions

October 22, 2013
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?