Discussions about the health care crisis often focus on the 46 million uninsured. But a growing number of insured Americans also cannot afford proper health care. In addition to raising premiums at double-digit rates, insurance companies are increasing deductibles and co-pays, leaving the insured to pick up much of the medical bill.
This cost-sharing approach among insurance companies - an approach that affects both employees and the self-employed - is being enacted with little regard to the consequences to the insured or to the health care system as a whole. In fact, not only are the underinsured receiving inadequate care, but cost-sharing can actually drive up the costs for everyone.
Being Underinsured
Although the meaning of “underinsured” can vary, most definitions are tied to an individual’s income. In his article “Issues facing America: Underinsured patients,” published by the American Academy of Orthopaedic Surgeons, Ryan M. Nunley, M.D., states that underinsured individuals are those whose medical expenses are greater than 10 percent of their income or whose medical expenses are greater than 5 percent of their income and that income is less than 200 percent of the federal poverty level.
Receiving Proper Health Care
Because of the cost-sharing model, many cannot afford the actual health services. As a result, they don’t seek medical help when needed or they fail to take necessary medications. According to Nunley, research shows that this behavior leads to an increase in serious adverse effects and emergency room visits. In addition, the cost-sharing approach, by design, shifts costs to the sicker populations, leading many to medical bankruptcy.
In her Online NewsHour article “Number of Underinsured Grows as Insurance Premiums Rise,” Stephanie Taylor reports that 17.1 million people under 65 were underinsured in 2003. Of these, 9.3 million had employer-based insurance. However, these numbers are based on a study that tallied what participants actually spent and don’t reflect those who would be considered underinsured if they encountered a catastrophe. As a result, the numbers are probably much higher - and they continue to grow.
Cost-Sharing and Health Care Costs
By shifting more expenses to patients, the cost-sharing approach leads to a general increase in health care costs. Taylor states that “expensive medical bills can leave consumers unable to pay, forcing practitioners to rely on collection firms, therefore driving up the administrative costs of doing business.” The higher health care costs are then passed on to the consumer, making the system even more inaccessible to the underinsured.
If patients choose to forego treatment and medication, rather than incurring debt, they wait until their conditions worsen and then go to the emergency room. Not only does this make their individual health care more expensive, but the process further strains the health care system and once again increases overall costs, creating a vicious cycle that continues to worsen and continues to take the greatest toll on the poor and sick.
Congress and the Underinsured
The primary step that Congress has taken to help the underinsured is to establish health savings accounts (HSAs) for individuals with high-deductible insurance plans. The plan allows them to set up special bank accounts (with pre-taxed money) to pay for medical expenses. However, Nunley believes that such policies only encourage the move toward cost-sharing plans, which still leave the underinsured to fend for themselves.
But members of Congress don’t have to be too concerned about such cost-sharing woes. They’re protected under the Federal Employees Health Benefits Program, a comprehensive health insurance package paid for primarily by taxpayers. They leave issues of inadequate health care and medical-related debt to the underinsured.
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