Enrollment in high-deductible health insurance plans has exploded over the past five years. I’m learning the hard way how these plans do — and do not — work.

About one-third of American workers covered by health insurance are now in high-deductible health plans, in which the policy holder pays a substantial portion of the cost of health care services out of pocket before insurance coverage kicks in. Many economists and health policy experts believe that these plans are a promising way to reduce health care spending.

So when a high-deductible plan became available through my employer, Harvard University, a couple years ago, I decided to enroll my family in it. If this is going to be a big national experiment, I thought that I, as a physician and a health policy scholar, ought to know what it’s like to live with this kind of health insurance. Debra, my wife, was not convinced.

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While I am a proponent of experiments and evidence, Deb wasn’t interested in including our kids in this one. The notion of having to think about shopping for health care if any of us got sick wasn’t attractive to her. But if we stay healthy all year, I argued, we would actually come out financially ahead.

She reminded me that we have plenty of other reasons to stay healthy all year, and the potential financial savings didn’t feel like a particularly compelling additional reason. Defeated by her logic, I turned to pleading.

I made the point that we had a lot of advantages in navigating the health care system effectively and that she and I should go about making the same health care decisions that we would have otherwise. She relented.

My family is now in its second year under a high-deductible plan. That means we are responsible for paying the first $6,000 of our health expenses for the year, for everything from a doctor visit for a flu shot to surgery.

It has been an educational enterprise.

Our experiment is showing me again and again that it’s extremely hard to be a health care consumer in Massachusetts — just as I’m sure it is in other states. Want to know how much a particular type of health care costs, like a visit to a specialist or getting a minor surgery? Good luck figuring it out. My insurance company’s online tool was hard to use and, even as a physician, I could almost never guess what sets of services a visit to the doctor might generate. What’s more, there was no useful information about the quality of care. Price information without quality information is not particularly helpful when shopping for medical care.

The second lesson was that being a health care consumer is stressful, at least the way the system is currently set up. Here’s an example. Our son had surgery last year. We got a call saying it was time for his one-year follow-up. Deb stressed for nearly two months over whether or not to make the appointment. Of course she wants our son to get the care he needs, but did he truly need this follow-up? That’s both the promise and the peril of high-deductible plans — they are supposed to make you think twice about consuming health care.

She eventually went with our son for his one-year follow-up — they spent two minutes with the surgeon — and paid $465 for the visit. I’m not sure my son, or my spouse, felt any better afterward. There were many examples like this sprinkled throughout the year, but the most profound one was the one I experienced for myself.

I have supraventricular tachycardia, a common heart rhythm problem. When it hits, my heart races at about 180 beats per minute. It comes on a couple of times a year, lasts a few minutes, and usually isn’t a big deal. But one morning I woke up with my heart racing. After 30 minutes, I wondered if I should go to the emergency department, knowing that I’d probably get stuck with a multi-thousand-dollar bill. So I kept waiting. After an hour, during which my heart kept beating furiously, my chest started to hurt. I knew what that meant — I was at risk of having a heart attack.

Deb asked me what I would tell a patient in this situation. That was easy: I’d tell him or her to call 911. But I kept waiting. Finally, about 15 minutes later, the abnormal rhythm finally broke and I felt my heart calm down. I was lucky — I had rolled the dice and things had worked out.

That brings me to the third lesson of high-deductible health plans, the lesson of what didn’t happen — I didn’t really have a choice of where to go for treatment.

Imagine that for dinner on any given night, your two choices were eating at a very expensive gourmet restaurant or not eating at all. I bet that more of us would forgo dinner a lot. (Thank goodness we have a range of options.)

The US health system is something like that. During my heart rhythm problem, I realistically had only one choice — going to the emergency department. Knowing that they are usually the only option, hospital administrators make emergency departments super expensive.

One promise of high-deductible plans is that if we have a real market for health care, we will see lots of innovation, including different types and levels of urgent care centers. But that hasn’t happened.

During my heart episode, all I really needed was a place that had a heart monitor and that stocked common, inexpensive rhythm-restoring heart medicines. The real cost should have been $200 to $300. If I had known that such a place existed, I would have gone there. But this mid-price range of options is rarely available in health care. So I skipped it. And that’s what people are doing under high-deductible plans — skipping needed care.

Here’s my major takeaway so far from this ongoing experiment: Simply asking people to pay out of pocket for their health care doesn’t create a health care marketplace. If we are going to be serious about creating one, we have to generate much more innovation in care delivery models, including much more leeway on the scope of practice regulations, such as letting nurses do a lot of the things that only doctors can do today.

We must be much more aggressive about price transparency and make quality data ubiquitous. The way we’re doing it now, even I as a doctor and a health policy expert can’t figure out when I or my family’s needs are worth the expense.

If we continue with high-deductible health plans the way they exist today, more and more people will experience what my family did — the stress of having to make medical decisions with little information and few choices. At best, we’ll have a health care system that might save a little money — but at the risk of harming the health of our citizens.

Ashish Jha, MD, is an internist at the VA Boston Healthcare System, a professor of health policy at the Harvard T.H. Chan School of Public Health, and director of the Harvard Global Health Institute.

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  • You are correct. There is certainly a less expensive way that health care can be delivered for common problems BUT sometimes a nurse practitioner is not enough. Twice our cardiologist’s nurse practitioner prescribed the incorrect medication because she did not first confer with the physician and it could have been life threatening. There is no transparency because the markup on everything is so outrageous. I got billed $100 for a dollar blood transfusion filter. Just because someone has insurance does not mean that they are going to run to a physician or emergency department for every little ache or pain. That is a totally erroneous thought. Because you paid out of pocket $465 and i might have paid $25 for a copay does not make me feel any less frustrated for a two minute visit. After all i am paying ridiculous premium prices that increase every year because my insurance is paying for that 2 minute visit but actually i am really paying for it if you think about it.

    • Yes, I agree. Also, I could never understand why nurses and PA can practice in healthcare after school but MD can’t unless they undergo residency. MD should be generalists and their pay would increase with pursuing a specialty. Difficult to figure out the rationale. The system in the US used to be like that and in other countries this is a norm. If a nursing school or a PA school offers better training than an MD school, there is something wrong with the American system; if MD schools in fact do provide better training ( an MD is a terminal degree) but MDs cannot practice after concluding school but PAs and nurses can – there is something wrong with the system.

  • I live in a state that did not expand medicaid. I do not make enough for a subsidy. I have a cancer with no cure. I have to pay $1119.19/mo for health insurance with a $6000 out of pocket/deductible. If it is not cancer related I just don’t do it. I can’t afford to. Have had a “cold” since Nov 3, still have it, have not been seen. Why? Because I have no money to pay that bill. I already had to choose between rent and health insurance and was homeless for 19 mo until I got into hud housing. I was fired for cancer (being “too expensive” for their insurance) and have cobbled together part time jobs as I can’t find a full time one. I am not sure I can afford to keep my health insurance all this year since it went up $169 a mo from last year and the out of pocket/deductible went up $1000 (and I was just laid off from my main part time job after 18 mo). Can we say welcome to your favorite least developed nation with respect to all the health care I can afford to have here in the USA?

    • What gets me is people need to start looking at healthcare as more of a necessity than cable, internet, the newest iPhone etc. Sure it’s not cheap. But maybe if some people could part with their top of the line electronics and the upkeep of said products, the newest Jordan’s, etc and looked at healthcare like they would their housing such as rent, or mortgage, it wouldn’t be as painful. I’m not saying everyone one fare better. I do know a lot that would. Especially those with more serious health conditions. I have had to sacrifice many luxuries to afford healthcare. I’m a single mother of two and do not qualify for subsidies or Medicaid in my state either. But I take full advantage of the preventive resources that are provided at no cost to try and keep small health problems from becoming big health problems. It’s much like car insurance. No one buys the cheapest insurance knowing they are going to total their car the next month. Same concept.

    • Victoria – the problem is that there are some of us who don’t have top of the line electronics, newer cars, etc. to be able to “cut out”. I do have internet (3mbps) because I work online – otherwise I’d not have it. No TV (indoor antenna doesn’t pick up any). My car is 26 years old. I am having to sacrifice necessities to have health care. And the only reason why is because you can’t have a cancer without a cure without heath insurance. If you want to live longer that is. Not everyone who is struggling with health care costs lives the high life or even makes the income to do so. I live below the poverty line. I get food stamps. HUD has me paying $68/mo for rent in a 2 room apartment (hud rent is dependent upon your income). What else should I be sacrificing? Many of my clothes have holes, I have 2 pairs of shoes. Haven’t had dental care in 4 years nor gotten new lenses for my glasses. I did look at it like rent. And I had to choose homelessness. What do people like me do?

  • “We must be much more aggressive about price transparency and make quality data ubiquitous. The way we’re doing it now, even I as a doctor and a health policy expert can’t figure out when I or my family’s needs are worth the expense.”

    That, and a drastic untangling of the care networks that dictate how much is and isn’t covered when you do visit. Like the author, I work for a major medical establishment, but when my wife recently needed care and was referred to a provider other than my employer, it took me two hours of digging to determine that the care would be covered as “in-network.”

    But even then, “shopping” for care often reduces in practice to self diagnosis, and weighing self-treatment with professional care. I’m not sure that’s a path to better outcomes, or lowering long term expense.

  • I believe doing well care should be rewarded. There are situations where you might have developed lived a fairly healthy life and still developed asthma. Never touched a cigarette, exposed to chemicals and healthcare providers and pts. that smoked like chimneys in my workplace. Every time I get a cold mine last longer even with appropriate inhalers, flu shot, etc. Why should I be hassled about my preexisting condition? With higher insurance payments and comments that I must not be living a healthy life style?

  • Dr. Jha, did you consider enrolling your children and wife and perhaps even yourself in a Direct Primary Care practice in conjunction with your HDHP?

    DPC practices offer 24/7 access to a primary care physician and in some instances substantial discounts on prescriptions, imaging and labs. All of this for a minimal subscription fee of $10 – 75 a month.

    DPC does not involve any insurance. No claims, deductibles, or copays. Easier for you, easier for the physician. No government or insurance intervention at all.

    Dr. Jeffrey Gold, Gold Direct Care in Marblehead would be a good resource.

    I suggest you look into it…

    Best,

    John Chamberlain

    • John

      Thank you so so much for the mention. So surprised to read the comments…get ready to go on a DPC sermon…and then see this. If only we could get the Boston docs to see the work we are doing

      Jeff

    • As someone who also has AVNRT, the primary care physicians I’ve seen are at a complete loss as to how to handle SVT and turf the patient to either a cardiologist or to ED. In my experience, even switching beta blockers was too much to ask.

  • For the record the IRS section 223 defines a high deductible plan has having a deductible for a family greater than $2,500 and a total out of pocket cost of of less than $12,500. A silver level Obamacare plan has a family deductible of $4,000. You have better insurance than you think you do.

  • First, the Harvard high deductible plan has a deductible of $3000 for a family and a $6000 total out of pocket cost. Preventative care like your flu shot is covered at no cost to you.

  • The article hit it right on! I and my husband own a business and he is on Medicare and VA. We don’t qualify for a small business plan or subsidy insurance. I researched for months and there were only 3 private plans to choose from in AZ. All of them were high deductible plans with the premiums between $630 to $777 a month. I chose a Cigna PPO plan because my drs were all in that plan only. It has a $6000 deductible before they cover anything. Once I meet that, I pay 40% of any covered cost up to $7150. They will pay 100% after I meet my deductible and out of pocket expense, which is a total of $7150. ($6000 + $1150). So do the math. That is $649 a month in premium at $7788 for one year. ($7788 premium + $7150 ded/out of pocket expense = $14,938 a year total.) This is what I would pay if I maxed my benefits. $14,938 for a year of insurance!!! I had 4 to 8 calls a day from insurance reps after I signed up on ONE health insurance website for quotes. They were aggressive in calling and telling me they could save me hundreds of dollars! As soon as I gave them my meds and on going health conditions, they said, Oh! Sorry we can’t assist you! Or we can help you but the plans will not pay for any pre-existing conditions for one year! Now WHY would I want a health plan that doesn’t cover my health conditions and meds? That is why I need insurance and use it! I am thankful that I can have insurance under the new act. When I didn’t have insurance I negotiated prices with my doctors and meds. Then I prayed I would not have to go to the hospital. At this moment I have a flare up of diverticulitis. I did the smart thing and went to Cigna Urgent Care and not the ER. They confirmed it and prescribed 2 meds. My visit and meds are the allowable amount they can charge under their contract with my health plan. It should be relatively low. However now I am getting worse and they want me to go to the ER! I don’t have $6000 in my bank account. I could use a charge card if needed but what if I feel better tomorrow? I will have saved $6000 plus interest! While I sit here stressing, I think will it get worse and will I wait too long and maybe die from a preforated colon or an abscess breaking and filling my body with an infection?! I love having insurance and yet having to make a decision between paying possibly $6000 makes me cringe! We as Americans shouldn’t have to stress out about going to the Dr or ER for our health needs because of extreme cost! Our lives are more important! However then we have to live with the stress of overdue bills. Which stress leads to health issues. Yes…I could put it on a credit card but what about those who can’t? I told my husband we are better off if we divorced. I could then qualify for a subsidy. Or I could find a job with health benefits but then we would have to pay a person to take my place at our business. What happened to the days of mom staying home, dad having all the benefits, college was affordable and you received a nice retirement pension and on going health benefits. Then when we needed assisted living we could afford that too! Only the wealthy and healthy savers can afford that! My husband and I sell auto/home insurance with several companies and those rates have risen too. Everyday we have clients that have been with us 20 plus years leaving and going to a non standard company because we can’t find anything cheaper. Or they lower their coverage limits on brand new vehicles with not enough coverage to pay for anything if in an accident. We have some younger generation going to school choosing no insurance all together as they just can’t make their rent. We pay for those who choose not to have home, auto or health insurance because they just don’t want to pay or really can’t afford it. Everything keeps going up in cost but our income and Social Security checks don’t go up to match the rising costs. Yes, many can choose to cut back on leisure activities and other things if they really wanted to save. But what do you do when you have done all that and still can’t afford the rising cost of insurance!? When will this Merry Go Round stop so we can get off the pretty white horse and get back to affording and enjoying life after a hard days work!?

  • We did a similar experiment in our family, and had similar results. In some ways, it’s been very positive. We question services, and appointments and prescriptions, and have found a significant number of errors in our medical bills now that we pay more attention. Tracking the bills, claims and payments for 2 healthcare professionals is far from straightforward. We’ve also learned to shop around for prescriptions (where prices can vary wildly, and which makes no sense to a typical consumer), and learned that even with the high-deductible plan the negotiated rates of care can cost significantly less than the full rate. We also ended up with one hospital admission that brought us comically close to the brink of our max coverage for the year.

    For us, it is an experiment and a choice. If we stayed healthy, the money we saved on premiums is available for other things. If we didn’t stay healthy, those savings went right back into the healthcare system with an approximate break-even.

    But for others, as has been mentioned, the only real choice among health care options is getting to the doctor (for that follow-up appointment as an example), or paying for more obvious family needs, or even paying for that dinner out a restaurant. And making that choice can be very difficult given the opaqueness of healthcare costs.

    • Totally agree with you. We are heading to have an old population because the younger generation are making the right choice- not having children. They grew up watching overworked parents with less and less rights but increasing demand. Education is a big business, they partnered with companies not to offer hands-on experience as part of the learning, but to offer certificates literally teaching nothing more than you can find researching online. Figure paying $495 for a 15 min class comprising 9 slides, the first 2 naming regulatory agencies worldwide. Health care in this country even paying a high price still years behind some countries offering universal health care.
      Dr. JHA took a huge risk by not looking for appropriated care even knowing as a doctor that the consequences could have been far worst for his family- when you hear a physician gambling with his own health for the sake of his pocket we sure know that the system is totally broke. And when on top of that, he thinks that increasing nurses job scope would benefit health care costs, It’s a push that I certainly disagree. We’ve been doing this for years and there was no improvement in quality but overburden doctors. I can’t even understand why an MD by training cannot practice without residency, couldn’t they provide what is missing?
      Universal health care is possible and every American have worked hard in life to make this country as productive as it is; therefore, you should be able to have access to get sick and die with dignity. It has to be a 2-way road.
      Two hours is the average waiting time in the ER of big cities in the US and in public systems in countries like Brazil. Why the US system costs are higher than any other country but the quality delivered is not better than countries in development, and below other developed countries like Canada?
      SHould we consider choices like Dr. JHA a good one? Or maybe prices rise when people take the same risks he took. Perhaps, life takes a turn for the worst and instead of an ER visit he would have a lifetime worth of complications that would have far more consequences for him and his family. Tons os people out in the ER who waited a bit too long.
      Lots of things to tackle to improve health care delivery in this country, but I disagree with whoever says that health care should be considered a consumer good. Health care is a citizens right, and should be treated like it.

  • Even with a background in health care (former EMT/ER Medic), a very sophisticated understanding of our health care system; work in health informatics; a low deductible plan in a large integrated system it is challenging to access urgent affordable care when your plan has a limited panel or the exchange and insurance companies computer systems aren’t synched.

    Over the holiday weekend Jan 14 – 16th I nearly bleed out from a gyn problem. I am an informed “consumer” and not easily concerned so I called the consulting nurse over the weekend when it became apparent I was losing too much blood. She told me what to look for but that I should be seen asap but it was a holiday the next day.
    So on Jan 17th I called at 8am for an appt, but I was told that my primary care doctor (in a medical home) didn’t have any openings for a week and to try to get in to see a GYN. My gyn of 10 years was outside of their exchange plan though so I called my new plans gyn clinic (which is part of the same 900 doctor system as my primary care doctor) but I was told at 9 am that it didn’t look like I had insurance coverage and even if I did the earliest appt was in 3 weeks and to call back once I had the insurance figured out.
    So I started to call my state health exchange (which sells non-subsidized plans) and the insurance company (part of an integrated system where I had gotten care for the last year) and after 6 calls I was assured I did have and had had coverage since December 1st and was all paid and current but that the state computer system missing a couple of thousand people in the monthly download and it would be fixed Jan 31st. WTF?

    I continued to bleed and was in intense pain, but I try to keep costs down (my deductible is only $850 and primary care visits are pre-deductible) so on Jan 16 at 1 am I again called the 24/7 consulting nurse and was referred back to my doctor’s office and the GYN offices and she said she would let them know via the EHR that I needed to be seen ASAP. On Jan 17th I called asking to be seen urgently but I was told sorry no openings and to go to urgent care.

    At noon we got there, but the Admin intake questioned my insurance coverage and told me it would be 30 minutes to be triaged but only after I had agreeing to assume all financial liability. I spent 20 minutes calling my insurance which told me yes I was covered but the computer didn’t show it on their screens and they refused to accept it over the phone. They asked me to “fax” them proof of coverage? How I was in their waiting room so I signed the forms.

    The admin then told me it would be a 2 hour wait to be seen (after an hour during which I bled through my clothes in the waiting room and threw up on the floor) I asked to talk to a nurse and she triaged me and told me to go to an ER instead because they didn’t handle active bleeding in urgent care and my vitals were indicating shock HR 126, BP 95/62. I called a firefighter friend to drive me home and he wanted to take me to the ER but I couldn’t afford the bills if I didn’t have coverage so I convinced him to take me home

    I pushed fluids, laid on my back with my hips up on the coach; and googled ACOG (American College of Gynecologists) to find out how to treat the problem (high doses of birth control) and treated it myself in tears.
    I called my former FFS gyn outside of the system and was seen the next day, and had an emergency procedure done. She told me based on labs, over the last days that I had lost 2 units of blood and to go to the ER the next time.

    On Friday I got the $456 urgent care bill for (triage) and this morning I got a call from the original GYN office confirming that I did have coverage and would I like to make an appointment in March? I haven’t seen the bills for the gyn that I did get in to see.

    So the next time someone says that people need to pay more out of pocket than we already do (my insurance costs me $650/month) just know if it is this hard for someone like me to get (let alone shop for) care and I did everything possible to try and be responsible and keep costs down for the sytem that some people are going to die or be hurt as a result of our insane way of covering their health.

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