Are Marketplace Plans Affordable? Consumer Perspectives from the Commonwealth Fund Affordable Care Act Tracking Survey, March–May 2015

By Sara R. Collins, Munira Gunja, Petra W. Rasmussen, Michelle M. Doty, Sophie Beutel
The Commonwealth Fund, September 25, 2015

From the Conclusion

On average, larger shares of people with marketplace plans have high deductibles than those in employer plans, with the differences widest among enrollees with higher incomes. Among those with lower incomes, the cost-sharing reduction subsidies appear to have had the effect of narrowing the difference in deductibles between those in marketplace plans and employer plans. Still, a large share of people with low and moderate incomes in marketplace plans have deductibles of more than $1,000.

We know from the results reported in our companion issue brief that premium cost factors more heavily than do deductible size and copayments when people are choosing health plans.

Consistent with recent research by The Commonwealth Fund, the growing use and size of deductibles in both employer and marketplace plans as a means to lower premiums threatens to undermine the gains Americans have made in coverage since 2014

Adults in high-deductible health plans are less confident in their ability to pay for their care if they were to become seriously ill compared to those with lower deductibles. People with the lowest incomes in these plans are the most at risk of spending large amounts of their income on medical care. Their lack of confidence about the future suggests they are aware of their financial vulnerabilities. In an economy that is still struggling to deliver significant wage gains to working families, ever higher cost-sharing in health plans will further degrade their financial security.…

Companion brief:…

How do people select their health plans? The most immediate concern to the plan purchaser is the premium that must be paid, and most will choose a plan with low net premiums. To gain greater market share, insurers will reduce premiums by shifting more of the health care costs to the patient, especially through higher deductibles.

It is not parsimony but rather an imposed frugality that motivates individuals to select plans with lower premiums. The high costs of health care and thus high premiums, combined with stagnant incomes, leave most individuals with little other choice.

People should not be have to be confronted with a decision that almost forces them to select a lower premium plan that could expose them to financial hardship should significant medical problems develop.

Under a well-designed single pager national health program, no decision would be necessary. Everyone would have the same comprehensive coverage with no need for premiums since the system would be funded through equitable taxes.