Politics & Policy

The Latest Problem under the Affordable Care Act: Deductibles

(Phasinphoto/Dreamstime)

We hear it every day from supporters of the Affordable Care Act: The fact that more people have health insurance now than before the law was signed is proof that it’s working. But this is hardly the best measure of the law’s success — after all, what good is health-insurance coverage for middle- and low-income families if they can’t afford to use it?

That’s the plight millions of Americans find themselves in today. And as a new analysis by my organization shows, it only got worse this year.

The latest problem with health plans obtained through the law’s exchanges is one that’s largely flown under the radar: the enormous deductibles that come with them. While monthly premiums can aptly be described as how much it costs to have insurance, deductibles are how much it costs to use it. On average, that cost now runs well into the thousands of dollars annually, severely limiting access to insurance patients can afford to use.

My organization, Freedom Partners Chamber of Commerce, recently released a deductible tracker showing just how much deductibles are increasing across the country. Using data from the Robert Wood Johnson Foundation and state-by-state enrollment figures provided by the federal Centers for Medicare and Medicaid Services, we calculated a weighted-average — which accounts for market share — of deductibles for Affordable Care Act plans in all 50 states.

RELATED: Why Is Obamacare Regulating Health Savings Accounts Out of Existence?

Here’s the short version: Average deductibles across bronze, silver, and gold plans obtained through the Affordable Care Act’s exchanges increased by $265, or 8.4 percent, in 2016.

These increases were deep and widespread. In total, 41 states saw average deductibles increase, with 17 states — representing 45 percent of total exchange enrollment — seeing double-digit spikes. The largest increases were in Mississippi (39 percent), Washington (31 percent), South Carolina (26 percent), Louisiana (24 percent), Florida (23 percent), Michigan and Vermont (22 percent), Arizona (21 percent), and North Carolina and Rhode Island (20 percent). By comparison, only two states (New Mexico and Oklahoma) had double-digit declines.

#share#The percentage increases are sobering, representing hundreds of dollars more that families will have to pay to access their health insurance this year. And those increases come on top of deductibles that were already too high for many to afford.

Average deductibles for silver plans — which accounted for nearly 70 percent of the exchanges’ 9.3 million enrollees last year — now average $2,994. The second most popular Bronze plans have average deductibles of $5,629. Of the three most popular categories, gold plans were the only category to see deductibles decline (by 0.6 percent to $1,105), but carry premiums too expensive for most Americans to afford.

Paying $3,000 or $5,600 before their insurance kicks in simply isn’t an option for most families in times of emergency.

Paying $3,000 or $5,600 before their insurance kicks in simply isn’t an option for most families in times of emergency. A December 2015 survey by Bankrate.com found that 63 percent of Americans don’t have enough savings to cover an unexpected emergency-room visit costing $1,000. A recent report from the New York Times put it bluntly: Rising out-of-pocket costs have rendered many exchange plans “all but useless” for those already struggling to make ends meet.

It’s important to note that higher deductibles are not bad in and of themselves. Some consumers may prefer high-deductible plans as a way to have lower monthly premiums or have more flexibility in their health-care spending decisions. What’s concerning is these increases are happening at the same time premiums are skyrocketing. A similar analysis by my organization found premiums for individual health plans increased by an average of 14.9 percent this year. Consumers with Affordable Care Act plans thus have no escape from skyrocketing costs.

#related#So, who’s to blame for these continued rising costs? While it’s natural to want to blame insurers, many of them are hemorrhaging cash on the exchanges, too. The largest U.S. health-insurance provider, UnitedHealth, recently announced losses of nearly $1 billion in 2015 and 2016 on plans sold via exchanges. Other insurers have also lost significant sums. They and other large insurers are even considering leaving the exchanges altogether in 2017, which could cancel hundreds of thousands of plans.

The real culprit is the Affordable Care Act itself. By mandating that all health-insurance policies cover all manner of treatments — regardless of whether a consumer actually wants or needs them — the law is driving up everyone’s costs across the board. Many new enrollees are also sicker than anticipated. And as costs rise, fewer people want the law’s plans, which drives prices higher for everyone else. It’s a vicious cycle with no end in sight.

Despite its name, the Affordable Care Act limits access to health care that people can actually afford to use — and it’s only getting worse with each passing year.

Most Popular

Elections

Kamala Harris Runs for Queen

I’m going to let you in on a secret about the 2020 presidential contest: Unless unforeseen circumstances lead to a true wave election, the legislative stakes will be extremely low. The odds are heavily stacked against Democrats’ retaking the Senate, and that means that even if a Democrat wins the White House, ... Read More
Culture

What We’ve Learned about Jussie Smollett

It’s been a few weeks since March 26, when all charges against Jussie Smollett were dropped and the actor declared that his version of events had been proven correct. How’s that going? Smollett’s celebrity defenders have gone quiet. His publicists and lawyers are dodging reporters. The @StandwithJussie ... Read More
Energy & Environment

The Climate Trap for Democrats

The more the climate debate changes, the more it stays the same. Polls show that the public is worried about climate change, but that doesn’t mean that it is any more ready to bear any burden or pay any price to combat it. If President Donald Trump claws his way to victory again in Pennsylvania and the ... Read More
White House

Sarah Sanders to Resign at End of June

Sarah Huckabee Sanders will resign from her position as White House press secretary at the end of the month, President Trump announced on Twitter Thursday afternoon. https://twitter.com/realDonaldTrump/status/1139263782142787585 Sanders, the daughter of former Arkansas governor Mike Huckabee, succeeded Sean ... Read More
Politics & Policy

But Why Is Guatemala Hungry?

I really, really don’t want to be on the “Nicolas Kristof Wrote Something Dumb” beat, but, Jiminy Cricket! Kristof has taken a trip to Guatemala, with a young woman from Arizona State University in tow. “My annual win-a-trip journey,” he writes. Reporting from Guatemala, he discovers that many ... Read More
Politics & Policy

On Painting Air Force One

And so it has come to this. Two oil tankers were just attacked in the Gulf of Oman, presumably by Iran. The United States and China are facing off in a confrontation that is about far more than trade. The southern border remains anarchic and uncontrolled. And Congress is asking: “Can I get the icon in ... Read More
World

Why Are the Western Middle Classes So Angry?

What is going on with the unending Brexit drama, the aftershocks of Donald Trump’s election, and the “yellow vests” protests in France? What drives the growing estrangement of southern and eastern Europe from the European Union establishment? What fuels the anti-EU themes of recent European elections and ... Read More