End the duopoly

High deductible health plans aren’t to blame for rising healthcare costs

fotofabrika – stock.adobe.com High Deductible Health Plans (HDHP) are causing some individuals to avoid seeking medical treatment because they cannot afford the out-of-pocket expenses, some experts suggest. The implication of this position is employers should only offer higher premium, traditional PPO style plans. This view is inaccurate and misguided as high deductible plans are a response to the issue, not the cause.

By any statistic, healthcare expenses and the cost of healthcare to consumers has gone up dramatically, outpacing inflation and wage growth. For example, According to the Kaiser Family Foundation, per capita spending on healthcare has gone from $2,000 in 1970 to $11,000 in 2018. This comparison is done in constant 2018 dollars.

The American Journal of Managed Care reports that healthcare spending by families with large employer health plans has increased two times faster than workers’ wages over the last 10 years.

The Milliman Medical Index reported that in 2018, the cost of healthcare for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan is $28,166.

The increase in the cost of healthcare has been driven by less competition due to the consolidation of providers, significant year-over-year increases in prescription costs, […]

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