Survey of Non-Group Health Insurance Enrollees, Wave 3

By Liz Hamel, Jamie Firth, Larry Levitt, Gary Claxton, and Mollyann Brodie
Kaiser Family Foundation, May 20, 2016

This survey is the third in a series that seeks to shed light on the experiences and opinions of those purchasing their own health insurance in the non-group market.

A somewhat higher share of non-group enrollees now report being in plans with high deductibles than did so in 2015. In the current survey, about half (49 percent) of those with ACA-compliant non-group coverage say their plan has an annual individual deductible of at least $1,500 or a family deductible of at least $3,000, up from just over a third (36 percent) last year. Those with Marketplace plans are somewhat less likely to report having a high deductible (46 percent, compared with 61 percent of those in ACA-compliant non-Marketplace plans), likely because many Marketplace enrollees qualify for cost-sharing subsidies that lower their deductible.

Health plan ratings and satisfaction with coverage

Similar to the trend in overall plan ratings, the current survey finds those with ACA-compliant non-group plans are less likely than in previous years to say their coverage is an “excellent” or “good” value for what they pay for it. Just over half (54 percent) now rate the value of their coverage as “only fair” or “poor” (up from 42 percent in 2015 and 39 percent in 2014). Those with employer-sponsored coverage, who generally pay a lower portion of their premium, are more likely than those with non-group coverage to see their plan as at least a “good” value for the money, but the share of this group saying the value is “only fair” or “poor” has also increased, from 28 percent in 2014 to 40 percent in 2016.

A majority of enrollees also say they are satisfied with their plan’s premium (54 percent of all those in ACA-compliant plans and 59 percent of those in Marketplace plans), and about half say the same about their deductible (50 percent of ACA-compliant enrollees and 51 percent of Marketplace enrollees). However, satisfaction with premiums and deductibles has declined since 2014. Nearly half now say they are dissatisfied with their plan’s annual deductible (47 percent among all those ACA-compliant plans and 46 percent in Marketplace plans), and four in ten are dissatisfied with their monthly premium (43 percent and 40 percent, respectively).

Each of these trends toward more negative ratings of non-group coverage may be related to the fact that more enrollees now report being in high-deductible plans (as noted above, 49 percent of those with ACA-compliant plans now have a high-deductible plan, up from 36 percent in 2015). The latest survey finds that those with high-deductible plans give their coverage lower ratings overall and are less likely than their counterparts in lower-deductible plans to say they are satisfied not only with their deductible, but also with their copays and premiums.

Financial protection of health insurance

About half (51 percent) of non-group enrollees with ACA-compliant plans say they feel well-protected by their health insurance; however, the share saying they feel vulnerable to high medical bills has risen over the past two years, from 36 percent in 2014 to 45 percent in the current survey. Again, it’s notable that while those with employer coverage are more likely than non-group enrollees with ACA-compliant plans to say they feel well-protected, this group has also seen a similar increase in the share saying they feel vulnerable (from 26 percent in 2014 to 36 percent today).

Half (50 percent) of those with ACA-compliant plans say it is difficult for them to afford the out-of-pocket health care costs not covered by insurance, and a similar share (46 percent) say it’s difficult to afford their monthly premiums (nearly identical to the 45 percent who said so in 2014). A similar percentage (51 percent) says it is difficult for them to afford paying off debt, while a much larger share (71 percent) reports difficulty saving money for retirement, education, and other purposes. Ranking lower in terms of difficulty, a third (33 percent) say they find it difficult to afford basic necessities like food, housing, and utilities.

Not surprisingly, those whose plans have higher deductibles are more likely than those with lower deductibles to say it is difficult for them to afford their out-of-pocket health care costs (58 percent versus 43 percent). This is despite the fact that those with high-deductible plans report higher incomes on average than those whose plans have lower deductibles.

Plan utilization and reported problems

Among those who’ve had ACA-compliant non-group coverage for at least a year, many report having problems with their plans. Most commonly, just over a third (36 percent) say their plan paid less than they expected for a bill, about a quarter (26 percent) say their plan wouldn’t cover or required a very expensive copay for a drug prescribed by their doctor, one in five (21 percent) say they were surprised to find their plan wouldn’t pay anything for care they thought was covered, and a similar share (20 percent) say that a particular doctor they wanted to see wasn’t covered by their plan.

Those who are heavier utilizers of health insurance are more likely than their counterparts to report some of these problems, including their plan paying less than they expected for a bill (47 percent versus 31 percent), their plan not covering a prescription or requiring a very expensive copay (37 percent versus 20 percent). Heavy utilizers are also more likely to report problems paying medical bills in the past 12 months (31 percent versus 16 percent).

In addition to problems with their plans, one in five (20 percent) of those who’ve had ACA-compliant coverage for at least a year say there was a time in the last 12 months when they or another family member covered by their plan needed medical care but did not get it because of the cost. Nearly as many (16 percent) say there was a time in the past year when they did not fill a prescription because of the cost.

Opinions of the Affordable Care Act among those with non-group coverage

As in previous waves of the survey, and as is true among the general population, overall views of the Affordable Care Act among those with non-group coverage are largely divided, with 46 percent saying they have a favorable view of the law and 48 percent unfavorable. Even among this population – whose views one might expect to be divided more on the basis of experience – the biggest differences in opinion are along partisan lines, with 75 percent of Democrats having a favorable view of the law, 79 percent of Republicans expressing an unfavorable view, and independents divided (40 percent favorable, 44 percent unfavorable).

Similar to last year, the largest divide in how people feel the law has impacted them is partisan, with Democrats overwhelmingly feeling they’ve benefited and Republicans overwhelmingly feeling they’ve been negatively affected.

From the Discussion

The share of enrollees who see their plan as a good value has been declining, reflecting growing dissatisfaction with premiums and cost-sharing. Some enrollees who have had their plan for a year or more report expensive drug copays, as well as surprise medical bills and other unexpected expenses they thought their plan covered.

Today’s report confirms the growing dissatisfaction with higher premiums and greater cost-sharing of not only ACA-compliant non-group plans but also employer-sponsored group plans as well. The share saying that they feel vulnerable to high medical bills has increased to 45 percent for non-group enrollees and 36 percent for those with employer coverage.

One of the most important functions of health insurance is to provide financial security in the face on medical need. In spite of the Affordable Care Act, that security is deteriorating.

The burden of insurance premiums could be greatly reduced by financing the system through equitable taxes based on the ability to pay. The burden of cost sharing could be greatly reduced by adopting a philosophy of pre-paid health care which has worked well in certain integrated health systems and in the health financing systems of many other nations.

Instead of erecting financial barriers to care, cost containment can be achieved through patient-friendly policies characteristic of a well designed single payer system. Let’s change direction.