By Michelle Andrews
Kaiser Health News, October 29, 2019
Everything old is new again. As open enrollment gets underway for next year’s job-based health insurance coverage, some employees are seeing traditional plans offered alongside or instead of the plans with sky-high deductibles that may have been their only choice in the past.
Some employers say that, in a tight labor market, offering a more generous plan with a deductible that’s less than four figures can be an attractive recruitment tool. Plus, a more traditional plan may appeal to workers who want more predictable out-of-pocket costs, even if the premium is a bit higher.
That said, consumer-directed plans are hardly disappearing. Fifty-eight percent of covered employees worked at companies that offered at least one high-deductible health plan in 2019, according to an annual survey of employer health benefits released by the Kaiser Family Foundation last month. That was second only to the 76% of covered workers who were at firms that offered a PPO plan.
According to the survey by the National Business Group on Health, employers that opted to add more choices to what they offered employees typically chose a traditional PPO plan. Members in these plans generally get the most generous coverage if they use providers in the plan’s network. But if they go out of network, plans often cover that as well, though they pay a smaller proportion of the costs. For the most part, deductibles are lower than the federal minimum for qualified high-deductible plans.
By Don McCanne, M.D.
High deductibles have been a major contributor to underinsurance – exposing individuals and families to financial hardship in spite of being enrolled in an insurance plan. This article indicates that employers are recognizing that offering only high-deductible plans to their employees is no longer wise and thus they are again offering PPO plans that have lower patient cost sharing and some limited out-of-network coverage. This reintroduction of better coverage may not represent altruistic employer concern for the employees but rather merely the recognition of the need to offer better health benefits in a tighter labor market.
Although this may reduce the intensity of the degree of underinsurance, it does not eliminate it. Many individuals find PPO cost sharing to be unaffordable as well. Also PPOs perpetuate the deficiencies of our multi-payer health care financing system, especially the profound administrative waste.
Taking a step back into a system that already cried out for reform does not get business off the hook. They really need to join the bandwagon for a model that would ensure comprehensive, affordable health care for all of their employees and everyone else. Businesses should seriously consider joining the campaign, “Business for Medicare for All,” led by Richard Master and Wendell Potter:
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