11/27/2023 0 Comments Medical out of pocket expensesWhen you make people pay more, they consume less care, even if it’s for lifesaving treatment. People are not smart shoppers or rational spenders when it comes to health care. Further, those at higher risk of a heart attack or stroke were more likely to cancel their prescriptions than people at lower risk. In fact, they were considered “high value” drugs because they were proven to save lives. This finding was for drugs that treat cholesterol and high blood pressure. These seniors weren’t taking optional, esoteric, exceptionally expensive medications. In other words, making seniors pay $10 more per prescription led to people dying. Worse, they said it led to an almost 33 percent increase in monthly mortality. The researchers claimed, however, that a simple $10 increase in cost-sharing, which many would consider a small amount of money, led to about a 23 percent decrease in drug consumption. Remember, people age 65 and older in the United States are insured with what most consider to be rather comprehensive coverage: Medicare. In a National Bureau of Economic Research working paper published last year, researchers looked at how increases in cost-sharing affected how older adults, who are more likely to need care, pay for and use drugs. They treat all patients the same, and they assume that all patients should be treated the same way. Making that the time when people are most discouraged from getting care doesn’t make sense.Ĭo-pays and co-insurance aren’t much better. We were in an Omicron surge at the beginning of this year. There is no valid argument for why that should be. The use of deductibles assumes that all medical spending is the same and that the system should disincentivize all of it, starting over each Jan. Instead, extra costs result in patients not seeking any care, even if they need it.Ĭost-sharing isn’t set up in a thoughtful way such that it might steer people away from inefficient care toward efficient care. But this moral-hazard argument assumes that patients are rational consumers, and it assumes that cost-sharing in the form of deductibles and co-pays makes them better shoppers. Out-of-pocket expenses exist for a reason people are less likely to spend their own money than an insurance company’s money, and these expenses are supposed to make patients stop and think before they get needless care. Unfortunately, it has not done enough to protect people from rising out-of-pocket expenses in the form of deductibles, co-pays and co-insurance. It reduced the number of Americans who were uninsured through the Medicaid expansion and the creation of the health insurance marketplaces. The Affordable Care Act was supposed to improve access to health insurance, and it did. More often, it’s because they’re underinsured. And about a quarter of American adults with this debt owe more than $5,000. More than 100 million Americans have medical debt, according to a recent Kaiser Health News-NPR investigation.
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