While the current administration would have you believe that a private option will be the key to driving down health care costs – proponents of consumer driven health care have empirical evidence that shows a real route to controlling health care costs is to place the decision on how much to spend back in the hands of the consumer.
One big problem with the current health care system is that those covered under traditional plans only pay deductibles then co-insurance. For one – they are “shopping” (buying health care services) – with other people’s money. It’s not likely that someone would question the need for a procedure or evaluate the cost effectiveness of a treatment when Humana is footing the bill.
When you are an HSA/HDHP customer – you have a higher vested interest in your health care. This is because your deductibles are much higher, and you are paying cash for most procedures. While we would never recommend turning down a needed health care procedure because of cost – you do have many more options when you’re paying cash.
For example – if you injured yourself skiing and wanted an MRI, it’s entirely possible to negotiate the price of that procedure down to what the insurance companies actually pay – and sometimes less. Doctors love to get cash in hand instead of waiting for the insurance companies to pay claims.
Another financial benefit is that there is no co-insurance. There are people that are tens of thousands of dollars in debt who have a perfectly good insurance plan, all because their 80/20 co-insurance stuck them with nasty bills they weren’t expecting. With an HSA/HDHP combo, there is NO co-insurance. Once you’ve spent your deductible – that’s it.
It’s somewhat amazing to speak with people who quiver over the thought of paying an extra $1500 in deductibles each year, but don’t care a bit about potential $10k surgery bills down the road because of co-insurance. If we truly want change, then it’s time to change the way we think about our health care.
Another added benefit of the HSA is that it cuts down on abuses of the system. I know several people who run to the emergency room at the slightest sign of trouble, when it would make much more sense (and be much more cost effective) to schedule a visit with your doctor or an urgent care clinic.
