Rising health insurance deductibles fuel middle-class anger and resentment

I can't agree more. I also went the self employed route just after ACA went into effect and the level of stress this entire process causes every year is mind boggling. To add insult to injury, my premiums are increasing at astonishing rates - orders of magnitude more than a typical standard of living salary increase.

Medical offices will bill anybody who might pay like the insurance you had 3 years ago...

I once tried to find out how much some blood tests were going to cost me. This entailed a 3-hour ping-pong session between Quest Labs and my insurance company, each claiming the other would be able to tell me. Finally after reaching what sounded like some people in a basement somewhere -- who were baffled at the idea I was calling them, by the way -- I was able to get the "list price" for each individual test and add them up (came to about $1200). When I tried to find out from my insurance company how much I would actually pay, they said "well, it's got to go through claims then we'll know." I asked to speak to someone in claims -- nope. Not possible. The only way to find out what I would be paying is do go through with the tests and get the real price afterwards. Pretty insane stuff.

The most insulting part was after all this when the insurance "customer service" guy said to me, "We know what it's like to be unsure of your finances." What? I'm sure about my finances. You aren't -- you can't even tell me the price!

Literally half the country tried to warn against this exact same thing happening before the ACA passed.

Hsa's are pretty simple.... Tax free account to pay for health expenses. If we all _exclusively_ had them, I think our insurance rates would drop significantly. Not only would purple be concerned about the price of procedures, but would actively keep a eye on their usage.

Everything you said is true and part of the problem. I do want to clarify some things though that people may not know.

There are several reasons the back-office literally can't tell you what the price will be. First, is that if you have insurance, they don't know. It is up to the payor (insurance company) what the final price will be. Even though there are negotiated rates, most procedures have up to 5 service levels. So depending on the service level, the price will be different. And the service level is based on what service was provided which by definition hasn't happened yet. The only way to actually do it would be to be more like a garage. It is $50 to do a level 2 office examination and then I'll quote you on what we find out then and you can choose to continue or not. Most people would be annoyed by this.

Additionally, there are different codes for things like new patient vs existing patient. Seems simple, right? Actually if you haven't been to your doctor in the last two year, you are a new patient regardless of how long they have been your doctor. The service levels mentioned above are why for years, you had do fill out a paper detailing your patient history every visit. This is called taking a family history and allows for higher service levels and higher reimbursement. This is finally changing now that the family history is stored in the EMRs.

So, we finally figure this all out. An office visit might be always fine but some procedures require a pre-authorization. The rules for this are unique to your employers specific health plan, not the generic Aetna (e.g.). They may require previous diagnosis codes in your chart to indicate you are a risk before agreeing to pay. For example, a 25 year old with blood in their stool may want a colon cancer screening but that is only approved for people 40+. There is back in forth between the office and the payor to figure this out.

Oh, we didn't mention that a lot of employers are now self funded. This means that up to a certain loss threshold X, the company pays the bills, not the payor. This is handled by a company called a TPA (third party administrator). Obviously there are deductibles and other things they control and keep track of as well. This new procedure may now put the employer over their stop loss for the year. The TPA now needs to submit this bill to the re-insurer. They may require even more or different documentation in order for them to process and pay this claim. This is why offices have such huge back office components because a lot of the bills just get bounced back. They have to figure out why and resubmit.

So why are the list prices we see on our bill so high when insurance pays so little but the doctor accepts it anyway? It is mostly a hedge against mistakes. Again, since each employer plan may pay out differently even for the same insurance (there can be carve outs), the doctors are incentivized to over price and let the TPA and payor figure it out. If they accidentally charged $150 for something that is reimbursed at $250, they lose money. It is better to charge $900 and just accept whatever they get. They now don't need to constantly update the price of thousands of CPT (current procedural terminology) codes and make sure they are always up to date.

And this is just part of it.... The only problem in healthcare is mis-aligned incentives. As long as they are allowed, nothing will change.

To your case, I would get a new doctor. Paying cash is not that rare anymore and they should know how to handle it. In addition, they seem to try to overcharge the payor and it got dropped to you in this case. Not sure that I would trust them moving forward.

This is the problem but what are the solutions? In my opinion, we need to change three things. Each one would be beneficial separately. 1) Move to national reference based pricing. Said more simply, no one can charge more than Medicare * 1.5 or 2. This gets rid of all the bull crap negotiations and the doctors can still do fine. 2) We need healthcare to move away from employment. This is a relic of WWII labor shortages and its time has come. Besides helping employees be more flexible, it also incentivizes payors to get people healthy. People are lazy and won't switch unless they have to. Today, if a payor pays for a wellness plan, that company is likely to switch to a competitor next year to save 1% and they now benefit from the healthier customer. 3) We need to split health insurance. Most insurance is against a tragedy or massive loss. A yearly physical is planned and not a loss but is managed together. We need health plans that are focused on wellness and prevention and are priced at $X/month. Health insurance moves to being used only for hospital visits, ambulance rides, getting cancer, heart attacks, etc. These now separate health insurance premiums can be tied to user behavior, just like car insurance and life insurance are today. I'm not saying this will make a perfect system but it is more transparent and a step in the right direction.

Last point, in the US part of the healthcare cost is our demand for extreme convenience. They put in Urgent Cares all over town. The thought was that a lot of people who use the expensive ER services would be better served with a cheaper option. The hope was that ER usage would drop. It did not, people now just go to the Urgent Care in addition. Sally has a cold and we are at the mall so let's just go triple check she isn't dying. People have the right take their kids to the doctor every day if they want but all actions have consequences. You also can't complain that healthcare is so expensive when you are such a high utilizer. The Urgent Care has to pay a dozen people to sit there all day and someone has to pay for that convenient access.

I used to be a lawyer (thankfully have since moved to a more rewarding career). My girlfriend at the time was erroneously billed $2000 for a procedure that the insurance company had pre-approved but later denied the claim for. She had them recorded pre-approving, and they failed to decline her claim within the statutorily specified period anyway so it was a prime facie invalid denial. I had to write several letters, talk on the phone with their legal department for hours, and ultimately get the state insurance commission to initiate an investigation before getting them to back down. It took over 60 hours of work from a qualified attorney to handle a grossly invalid claim denial. Had I charged her at what was then my actual hourly rate, it would have cost $18000 to handle her $2k problem, for which she received no compensation. I honestly don't know how people get healthcare in this country without getting a law degree first.

> I agreed to pay $450 cash and no one in the office understood how to handle it. I finally get to pay the $450 cash and I still got a bill from my insurance for $600 because they also billed my insurance.

That's not how that works. If a provider submits to insurance, the insurance won't pay it, and the provider will send the unpaid balance to you. The insurance company won't send you a bill.

> Then there's the insanity of cash price being cheaper than the insurance price.

Not insane. They have to bill higher and the insurance company will have negotiated a 'discount' typically. Also, it costs more money to have people on staff to file with insurance rather than just accept cash. You have to pay for people's time.

> I also have an HSA tax free bank account that lets me pay for this stupidity tax free, yay! Dozens of more hours were thrown away trying to understand how HSA accounts work, what I can charge to the HSA account and picking a bank to handle the HSA account.

Totally agree with you on this one. It's pretty confusing to say the least.

Just give consumers access to a price list before service is provided. That will go a long way towards helping the problem.

(Not that you are going to price shop for every service--a trip to the emergency room for a broken bone wonte get shopped--but some portion of health Care is discretionary or is deliberate enough it can be shopped.)

The prices started going up as soon as ACA was being voted on, "just in case".

Edit: It seems my comment is being interpeted as for or against ACA, when the point was really that insurance companies will raise prices over every potential regulation change.

Prior to ACA, your pricing reflected the fact that the insurance co. could refuse to cover people with pre-existing conditions (ie sick people).

ACA forced them to cover everyone, which raised costs and, therefore, prices for everyone.

It's true you're now subsidizing sick people, but you'll be happy to have the ACA if you're ever sick (or have a dick family member).

Your $80 insurance was trash. You think you had coverage but the moment anything serious happened to you, you'd get thrown off.

Cancer? Bye.

Heart problems? See you later.

They were a fraud and you were getting ripped off.

ADA put an end to that fraud. Insurance companies could no longer arbitrarily throw you off. That's why premiums went up from $80. They had to actually provide coverage.

Now you know two things.

That sucks, but not nearly as much as not being able to get coverage for a pre-existing condition, at any price.

People are acting as if things were paradise before ACA. I agree that it wasn’t a good law but before it passed there were plenty of people who couldn’t get insurance due to pre existing conditions or they would get thrown off their plans once they got actually sick. Blaming all problems on ACA is rewriting history of the worst kind.

Poor whites think government is the problem. Wealthy people have private insurance from their employers. We are stuck with the current system, there is no impetus for change. Just a lot of stupid coming out of the white house. Sad!

My partner works at a hospital billing insurance companies and nobody there can even figure out what prices are. They can't optimize their work based on price because a $700k bill might end up bringing in $30k in revenue, while a $45k bill might bring in $35k.

Hospitals basically need an army of lawyers to renegotiate costs on a per-patient basis. Talk about efficiency!

Medicare/Medicaid literally keep most hospitals afloat. They are basically the only insurer who is fair and pays consistently.

> single-payer system

Why could I not buy my own insurance? Or why can't I self-insure? If I want to pay for the best, I ought to be able to buy it (again, if I will pay).

There's a difference between actual single-payer (in which there is a single entity which pays, the government) and a government health-care plan. For which are you advocating?

100% agree here. It was originally offered as a work around to wage controls.

More employers ought to do this, for sure. If I'm a young, healthy, twenty-six-year-old man, I almost certainly don't need medical care. If I've got a good job, I can essentially self-insure. I might want to keep actual insurance, i.e. high-deductible protection for catastrophic events, but nothing more.

"Give employees a statement showing how much the employer paid..."

Box 12, code DD on your W-2 reports "the cost of coverage under an employer-sponsored group health plan" as required by the ACA [1] (includes the premiums you paid, but you can subtract those out).

[1] https://www.irs.gov/affordable-care-act/form-w-2-reporting-o...

That would probably bankrupt Medicare.

Now, I'm not in favor of Medicare paying less than cost. It's a dishonest hidden subsidy. But be careful of how you fix it...

Please don't take HN threads into partisan flamewar. It's off topic here.

https://news.ycombinator.com/newsguidelines.html

With employer based insurance and lack of price transparency there is almost nothing the patient can do to reduce costs. You can’t get any upfront pricing, it’s hard to evaluate whether a test is needed, you can’t change insurance.

You are giving the patient responsibility for something they have almost no chance to understand.

This idea would only hypothetically work without Medicare or Medicaid. Right now all it does is squeeze the middle class even more as they’re required to further bare the costs of the ever-rising, all-consuming system.

So now the middle class, a large, still-working tax base, is the only group required to ration health-care. I always found that a bit odd.

As with many things, a high deductible plan makes sense in theory and does not work very well for the average person in reality.

To walk through some but by no means all of the problems:

- The average person is bad with money. Always has been, likely always will be. A high deductible plan only "works" if you hold onto the money you would have spent on higher upfront premiums so that you can directly pay for care if you turn out to need it. The problem is, the average person lives paycheck to paycheck, saw the extra money in their bank account, and spent it. Now they're reluctant to get any care, even when necessary, because they don't have the money and it looks like a new expense. Which leads to worse health outcomes, and more things being put off until they become expensive emergencies.

- Few people have the medical knowledge to determine what tests are unnecessary or what procedures are marginally useful. Most people are not in the habit of challenging people who are the experts in the field, who they explicitly went to see for their knowledge.

- Even fewer people have that medical knowledge and have the time and energy to spend on navigating near-incomprehensible bureaucracies to actually compare prices, quality of care, etc to try to make an optimal choice.

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The solution to expensive healthcare should not be that everyone needs to become financially disciplined, a domain expert in healthcare willing to challenge authority figures, and to waste large amounts of their own time attempting to provider-shop in a system unlikely to ever make that a simple process.

I have a HDHP. I save a bunch of money with it, and unlike the average person, I'm in a position where I can do all those things. I get a relatively optimal outcome, although it still wastes a bunch of my time to navigate.

While I personally benefit, I strongly feel that HDHP's are not proving to be a net-positive for the system or society.

Here's a recent Bloomberg article basically going through a bunch of those unintended consequences: https://www.bloomberg.com/news/features/2018-06-26/sky-high-...

Fear of bankruptcy shouldn't be a motivator for staying healthy.