Consumer Driven Health Plans Save 21%

American Shareholders ^ | Ryan Ellis

[nateriver]

The American Academy of Actuaries published a study on Consumer Driven Health Plans that not only showed savings but also care was received in equal or greater degrees to traditional plans.

[Kansas58]

I am a health insurance agent.
I have a $5,000 deductible plan.
It costs, roughly, $100.00 per month.
I am 50 years old, a male, and a non smoker.

This is what almost EVERYONE should do.

It is not the purpose of insurance to cover EVERYTHING, anymore than home owners insurance should buy your light bulbs or paint your house!

[b4its2late]

Is that $5,000 inpatient? If you have $5,000 on both in and out, you must pay for everything plus $100 a month.

[NautiNurse]

I'm pleased to see the numbers confirm what I have been saying for years. Health insurance should be for catastrophic coverage. Only when the consumer controls the purse strings can health care costs be negotiated properly.

Imagine how much auto insurance would cost if it covered every oil change, tire rotation, and battery replacement.

[Nachum]

Most consumer driven plans have a deductable that must apply to hospital, doctors office, and drugs combined. Once met, many will pick up 100% of cost (in your PPO network). Deductables range from as low as 1800 to as high as 5000.

In California, I find that the $3500 is my most popular plan.

[gitmogrunt]

I agree 100% with your approach.

Private Health insurance is the way to go, with some reforms of the industry.

I suspect many Americans, are to cheap to pay their own premiums, and instead rather spend their money on booze, tobacco, and junk foods, then go to the public hospital and expect the rest of us to pay for their bad choices.

[Kansas58]

But, here is the ERROR in the lefts push for socialized medicine:

Socialized Medicine can NOT “reduce costs” because access to more health care services will increase demand and increase cost to the rest of us!

The tobacco user with COPD SHOULD pay more than the person who does not use Tobacco. However, Medicare Part D and Medicare Part C and Medicare Part B do NOT charge more for bad behavior!

Another point is that the irresponsible, who can afford health insurance NOW, but refuse to pay for it, should probably be allowed that option. Remember, I am a health insurance agent. However, I realize that government mandates usually make things worse, and the quality for everyone will decline, if a “one size fits all” government program is developed.

Perhaps the most important point that is missed by the left?

What difference is there, really, between some crack head or hooker or gang banger without insurance, going to the hospital for care, which drives up medical costs for all of us through cost shifting -—

Or, charging higher taxes to all of us, up front, so that the hooker or gang banger or crack head gets “free” medical insurance?

Either way, the responsible are left to pay the bills for the irresponsible. What have we accomplished?

And, if you give the crack head, the hooker, or the gang banger a “free” health insurance card, don’t you think those folks will use the system MORE than they use it now?

(Especially through fraudulent attempts to obtain narcotic drugs?)

Also, health insurance coverage is an INCENTIVE to keep people out of the criminal class, and to get people into REAL jobs with health insurance benefits.

Do we really want to destroy another incentive, out there?

[CharlesWayneCT]

Only about 5 percent of the population buys their own health insurance. I am convinced that if companies who didn't provide their own health insurance (self-funded) for their employees were not allowed to otherwise buy health insurance for them, but instead were allowed to give them tax-free money to buy their own insurance, that insurance would be much better, cheaper, and more people would be able to afford it.

I don't think companies who actually provide health insurance directly to their employees should be stopped though -- at least not yet. If people were all upset about their coverage, but that doesn't seem to be the case.

I know that if I had my choice, and there was an insurance company out there to offer it, I would get insurance based on my lifestyle.

Not to stray too much, but the biggest problem with insurance plans I see is that, if you really make them "fair" young people won't pay much at all, and old people will pay huge amounts since at some point they are pretty much guaranteed of having major medical expenses.

Most employee plans, either avoid this, or if they do anything, it's much less than the real costs (my employer charges us for insurance based on our salary, which loosely corresponds to years of service but not by much).

[jeffc]

I like the idea that doctor did about charging a flat rate for services (it was, what, $79/mo?). It makes more sense for older people and families with children (always taking the kids in for check-ups, school vaccinations, bumps and bruises that look/are serious, etc.) than paying X amount per month, but with a high deductible.
Young, single people, or those without children would prefer the low premium/high deductible type of insurance, as they rarely use doctors.

We have a high deductible and two school-age children. We've yet to meet the deductible and actually haven't used the insurance pay for anything. To me, that's just catastrophic insurance. Since catastrophies rarely happen, you'd think the insurance premium would be fairly low, it's not!

I also think doctors should advertise prices. You sure can't negotiate with them, except to make monthly payments on some service provided that you can't afford all at once.
If there was a way to get people to a doctor at the first sign of a problem, taking care of it early costs less all around for everyone. But that would need to cheaper than it is now. People with a high deductibles tend to put things off because of the high cost, whereas those with a, say, $25 co-pay, will visit their doctor sooner and catch things before they get too costly. That's how to lower costs.

[CharlesWayneCT]

Imagine how much an oil change would cost if it was covered by insurance, so that people who shopped for one didn’t care what it cost.

[razorboy]

If I had a $5000 deductible on my health insurance I might as well not have health insurance. At almost 40 I’ve never come close to spending that much (combined out of pocket and insurance) on my healthl.

[Kansas58]

Well, with that logic, don’t buy life insurance either, since, so far, you have not died, right?

Do you have a clue what it costs for open heart surgery, cancer surgery, or other major illnesses?

Do you know what it costs to get an organ transplant, or to go on kidney dialysis?

And, if you think medical bills of $5,000 are a crises which requires that we scrap our current system, that is ridiculous.

The purpose of health insurance is NOT to gain access to health care.

The purpose of health insurance is to keep the patient out of bankruptcy court.

If you do not have any money or assets?

Bankruptcy court is a perfectly honorable option.

[jeffc]

Not to stray too much, but the biggest problem with insurance plans I see is that, if you really make them "fair" young people won't pay much at all, and old people will pay huge amounts since at some point they are pretty much guaranteed of having major medical expenses.

Maybe if there was a way to pay your insurance premium so that, if you don't use any of it (or only a small portion of what you pay in) in any one year, the rest, or a portion of it, could be "banked" for your "later" years to help offset the increased frequency and costs that invariably happen as you age?
I remember being in my early 20's and never going to the doctor, but paying a healthy premium (and so did my employer - we shared the costs). Some people need to go to the doctor every year, or multiple times per year (diabetes, hypertension, thyroid problems, things like that) no matter what their age, but do not engage in "risky" activities that could lead to high medical bills, so that needs to be taken into account - just because someone needs to see a doctor twice or three times a year does not mean they lead a "risky" lifestyle.

But which "type" of insurance actually is more low-cost? A high deductible, where the insurance hardly ever pays anything out, but when it does, it's a large amount? Or a co-pay system, where you see a doctor at the first sign of a problem because it's such a low cost that you can treat something early, and therefor, less costly (in the long run)?
Seems to me that it would one type for young non-family types and another for those with children.

[razorboy]

Wow way to miss the point. Here’s all I’m saying, if I went with his plan I’d be spending $1200 a year to get NO benefit. Even the semi-medical catastrophes I’ve had haven’t come anywhere near that $5000 deductible.

I never said anything about scraping the current system, try to react only to what’s written not your own assumptions.

I think there’s room for different kinds of insurance, in health care and other types. If you only want catastrophic coverage great, I personally like basic access coverage for myself. And health care is by no means the only place where we have that style of coverage, you can get very similar home owners and renters insurance, that will pay for even rather minor repairs and replacements.

[Kansas58]

Here is the correct way to do the math:

I am spending, roughly, $100.00 a month for a $5,000.00 deductible plan.

If I were, say, to reduce my deductible to a $500.00 plan, my premiums would be nearly $400.00 a month.

That is $4,800 a year.

Save the difference in premium:

500 - 100 = 400.

Divide the savings into the higher deductible (to be fair you should divide the savings into the DIFFERENCE in the deductible, but I will use the full $5000.00 here)

$5000/400 = 12.5 months.

I a little over a year, you can SAVE the difference in premiums, and never worry about your deductible again!

More to the point, you can BANK that money, use it in retirement, leave it to your kids, or do whatever you want with it. It is YOUR money.

If you paid it to the insurance company, it would be gone.

[Kansas58]

Well, in case you missed it, I support your right to buy “kitchen sink” insurance that covers everything.

I think it is a waste of money, but that is YOUR right.

I also think it is my right to buy “cat” coverage, and pay the little stuff out of my own pocket.

[b4its2late]

Yes. It’s a good to prevent unnecessary use. HSA’s are a good idea too for those years when you might have to see the doc, or have a necessary procedure. Allot of this could be solved with better planning, not a government takeover, but we see that many Americans don’t care what the cost. Medicaid patients seem to frequent doctors more than anyone else since they pay nothing.

[razorboy]

Doesn’t matter how you slice up the math, that style of coverage for me is useless, it’s money tossed down the toilet. I’d be spending $100 a month on insurance that I’d never use.

A lot of these kinds of things you need to figure out who you are. I’m an almost 40 year old guy in excellent health, I have one standing prescription and it’s an optional use allergy medicine, all my various medical numbers (cholesterol, BP, etc.) are good. I’m simply not a guy that needs to spend a lot of money on health care, so I insure accordingly, I pay the least I can for my coverage and it gives me the least coverage but without some big fat deductible.

Now if my health was worse, if I was actually in some serious risk categories, and possibly as I get older, that might all change. It’s possible that when I get to 50 I could look at your setup and say “yes that’s the coverage plan for me”, but currently it’s not. If I had your plan right now I’d give the insurance company $1200 a year, and give my various doctors about the same maybe less, I’d never get any benefit from the insurance coverage.

[Kansas58]

Well, insurance is NOT an investment.

If you get your money's worth, out of an insurance company, it means that something very bad happened to you!

You have every right to “work without a net” -—

However, I have been doing this for 25 years.

I have talked to lots of folks who want no coverage at all, but then got sick, got diagnosed with diabetes or cancer or some obscure disease, had a heart attack or stroke -—

And THEN cursed the insurance industry for “pre-existing conditions” rules.

You have every right, in a free society, to judge the risks for yourself and act accordingly.

However, it is YOUR risk.

Accept it like a man when something bad happens to you.

That is all I ask.

[N3WBI3]

I would think at a minimum health insurance should cover one yearly physical, immunizations, and catastrophic services / insanely expensive medication..