Nobody likes high health insurance deductibles, but more and more people are stuck with them. What you have to shell out before your health insurance kicks in rose 63 percent between 2011 and 2016, while average wages only 11 percent. People buying insurance on their own routinely face deductibles of $4,000 or more.
People in high deductible health plans can have a hard time coping. Research has shown they tend to put off going to the doctor or emergency room for fear of running up a bill—a fear amply justified by the fact that they are also more likely to get into trouble with medical debt.
Ashish Jha, a Harvard professor who’s both a doctor and health policy scholar, recently confessed that even with all his expertise, after he switched his family to a high deductible health plan he took a risk by putting off an expensive emergency room visit for a cardiac symptom, hoping it would resolve by itself (it did).
If you have no choice but to be in a high deductible health plan, here are some strategies for how to deal.
1. Understand to what the deductible applies. You’ve probably heard or read that a health insurance deductible is the amount you have to pay out of pocket for your health care every year—say, $2,000—before your insurance kicks in. It’s true that some plans do work that way, but by no means all. Some high deductible health plans will cover certain categories of expenses right off the bat with just a copay—typically outpatient doctors visits and prescription drugs.
Take, for instance, a Humana plan sold in Illinois with a horrendous-sounding $4,150 deductible. Turns out you don’t have to meet the deductible for primary care doctor visits, which come with $20 copay, or for specialist visits, which cost $40. And there’s no deductible at all for prescription drug coverage. But you will have to meet the deductible if you go to the hospital, get a lab or imaging test, or have outpatient surgery. How can you tell the difference? The services to which the deductible applies are labeled “after deductible.”
And remember, certain preventive services are free, with no deductible, in all insurance plans, thanks to the Affordable Care Act.
2. Contribute to your Health Savings Account (HSA) if you have one and can afford it. An HSA is kind of like an Individual Retirement Account for health insurance. It’s a private investment account that you (and your employer if it so chooses) can put money into tax-free. You can withdraw money from your HSA, again tax-free, to pay for medical expenses. It’s yours to keep permanently, even if you switch out of a high deductible health plan or leave your job. Not all high-deductible plans come with an HSA. If yours does, your plan documents will tell you so.
3. Shop around for good prices (if you can). Need an MRI of your knee? Blood tests? A diagnostic colonoscopy? You probably know that your insurance company has negotiated prices for those services with various “participating providers.” But you may not know that these prices can vary quite a bit, depending on the negotiating clout of the provider and the location of the services (anything done in a hospital is likely to be more expensive than the same service done elsewhere).
Most insurance companies now have some sort of price lookup service where members can compare costs from different providers. To access it, you’ll need to set up a login and password. But don’t get your expectations too high: the services only work well for relatively straightforward, common procedures, not for treatment of complex or serious illnesses.
Nancy Metcalf is an award-winning independent journalist specializing in health topics. A senior writer and editor for Consumer Reports for more than 25 years, she is a nationally recognized expert on health insurance and health reform.