ACA Does Little To Improve Factors Leading to Medical Debt Among People With Insurance 

While helping underinsured Americans struggling to pay medical bills of family members facing serious or chronic illness was one of the goals touted by many supporters of the Patient Protection & Affordable Care Act (ACA), information about the sources of these struggles revealed in a new the findings of the new Kaiser Family Foundation report on Medical Debt Among People With Health Insurance (Report) suggests little will change for Americans that choose to enroll in health coverage through the ACA-created federal or state Health Insurance Exchanges

The Report explores the reasons that one in three Americans continue to report difficulty paying their medical bills. even when they have insurance, by drawing insights from the experiences of nearly two dozen people who recently experienced such problems.  According to the Report, cost-sharing provisions like those incorporated into the ACA-created health plan options offered through the Health Insurance Exchanges are the primary trigger of the medical debt crisis for insured Americans. .  Concluding that health plan cost-sharing is a primary contributor to medical debt, the Report concludes that ACA ‘s reforms provide little relief for Americans from these challenges.

According to the Report, none of the individuals interviewed had sufficient savings to pay even their portion of covered, in-network medical bills..  The Report attributed this problem primarily to cost-sharing requirements imposed under  typical group health plans in 2013 and replicated in the coverage design of health plans offered through health insurance exchanges generally require Americans to pay medical expenses in excess of the amount of liquid cash balances most households.

Noting that most Americans have less than $3,000 on hand to cover cost-sharing and other uncovered  medical costs, the Report finds that even relatively modest cost-sharing can prove unaffordable because expenses often are unexpected.

The Report states that in 2013, the average annual deductible for single coverage provided under a group health plans in 2013 was $1,135.  In addition to this deductible,  these plans also required covered persons to pay additional cost-sharing expenses up to the annual out-of-pocket (OOP) maximum.  The Report states the OOP maximum generally is less than $3,000 for a single person.  Taking into account the limited liquid savings of Americans, the Report concludes that cost-sharing from a single surgery could rapidly deplete liquid cash assets for most people.

The Report goes on to add that the increased prevalence of high-deductible health plans exacerbates this challenge.   n 2013 38% of workers have annual deductibles in excess of $1000 (single) and 43% have annual OOP maximums greater than $3,000. For many people covered under these plans, even with income above 400% of the Federal Poverty Level, an extended illness or chronic condition easily results in result in unaffordable medical bills.

The Report also identify other factors that compound the effect of unaffordable cost-sharing, including:

  • Out-of-network expenses may also arise, often inadvertently for people hospitalized when hospital-based providers aren’t in the plan network;
  • Health care providers tend to promptly refer patients who can’t pay to collections;
  • Patients may use credit cards to pay unaffordable medical bills, which increases debt;
  • Illness often triggers income loss, further aggravating affordability problems;
  • People facing health issues may have trouble tracking medical expenses and resolving billing problems on their own; and
  • High insurance premiums further tax the budgets of insured Americans even while leaving many uncovered for significant medical costs;
  • Medical debt is also linked to housing instability, reduced retirement savings, damaged credit, bankruptcy, and barriers to accessing care.

The Report concludes that ACA does little to improve these challenges despite its significant reforms and expenditures.

About Project COPE: The Coalition On Patient Empowerment & Its  Coalition on Responsible Health Policy

Do you have feedback or other experiences to share about medical debit, ACA or other health care challenges?  Have ideas for helping improve our system, helping Americans cope with these and other health care challenges or other health care matters? Know other helpful resources or experiences that you are willing to share?  Are you concerned about health care coverage or other health care and disability issues or policy concerns?  Join the discussion and share your input by joining Project COPE: Coalition for Patient Empowerment here.

Sharing and promoting the use of practical practices, tools, information and ideas that patients and their families, health care providers, employers, health plans, communities and policymakers can share and offer to help patients, their families and others in their care communities to understand and work together to better help the patients, their family and their professional and private care community plan for and manage these  needs is the purpose of Project COPE, The Coalition on Patient Empowerment & It’s Affiliate, the Coalition on Responsible Health Policy.

The best opportunity to improve access to quality, affordable health care for all Americans is for every American, and every employer, insurer, and community organization to seize the opportunity to be good Samaritans.  The government, health care providers, insurers and community organizations can help by providing education and resources to make understanding and dealing with the realities of illness, disability or aging easier for a patient and their family, the affected employers and others. At the end of the day, however, caring for people requires the human touch.  Americans can best improve health care by not waiting for someone else to step up:  Step up and help bridge the gap when you or your organization can. Speak up to help communicate and facilitate when you can.  Building health care neighborhoods filled with good neighbors throughout the community is the key.

The outcome of this latest health care reform push is only a small part of a continuing process.  Whether or not the Affordable Care Act makes financing care better or worse, the same challenges exist.  The real meaning of the enacted reforms will be determined largely by the shaping and implementation of regulations and enforcement actions which generally are conducted outside the public eye.  Americans individually and collectively clearly should monitor and continue to provide input through this critical time to help shape constructive rather than obstructive policy. Regardless of how the policy ultimately evolves, however, Americans, American businesses, and American communities still will need to roll up their sleeves and work to deal with the realities of dealing with ill, aging and disabled people and their families.  While the reimbursement and coverage map will change and new government mandates will confine providers, payers and patients, the practical needs and challenges of patients and families will be the same and confusion about the new configuration will create new challenges as patients, providers and payers work through the changes.

We also encourage you and others to help develop real meaningful improvements by joining Project COPE: Coalition for Patient Empowerment here by sharing ideas, tools and other solutions and other resources. The Coalition For Responsible Health Care Policy provides a resource that concerned Americans can use to share, monitor and discuss the Health Care Reform law and other health care, insurance and related laws, regulations, policies and practices and options for promoting access to quality, affordable healthcare through the design, administration and enforcement of these regulations.

Other Helpful Resources & Other Information

We hope that this information is useful to you.   If you found these updates of interest, you also be interested in one or more of the following other recent articles published on the Coalition for Responsible Health Care Reform electronic publication available here, our electronic Solutions Law Press Health Care Update publication available here, or our HR & Benefits Update electronic publication available here .  You also can get access to information about how you can arrange for training on “Building Your Family’s Health Care Toolkit,”  using the “PlayForLife” resources to organize low-cost wellness programs in your workplace, school, church or other communities, and other process improvement, compliance and other training and other resources for health care providers, employers, health plans, community leaders and others here. If you or someone else you know would like to receive future updates about developments on these and other concerns, please be sure that we have your current contact information – including your preferred e-mail by creating or updating your profile here. You can reach other recent updates and other informative publications and resources.

Recent examples of these publications include:

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