High-deductible plans causing issues for health care providers


High-deductible plans causing issues for health care providers
The Business Journal of the Greater Triad Area - by Steve Ivey Staff
writer

Health care providers around the Triad are finding that increasingly
popular high-deductible insurance plans are leading to difficulty
collecting payments from patients.

The plans come with a deductible of anywhere from $1,150 to $5,800
that allows employers and enrollees to keep their premiums down. Many
of the plans are tied to health savings accounts (HSAs) that employers
or patients can fund with tax-deductible deposits to help pay those
out-of-pocket costs.

But doctors are seeing that, given the troubled economy, patients are
paying bills and buying necessities before they fund their accounts.
It’s creating a new class of patient: one who’s insured but can’t
afford up-front costs before coverage kicks in.

Fran Sembert, director of managed care for Greensboro-based
multispecialty group Eagle Physicians & Associates, said insurance
companies won’t allow doctors to collect on high deductibles until the
insurer fully processes the claim, which can take 30 to 45 days.

“After that, in this economy, any hope we had of collecting that money
is out the window,” Sembert said, because it’s easier to collect
payment or work out a plan when a patient is in the office receiving
care. “It’s the way of the future, but it is extremely costly to a
practice.”

Physicians groups around the Triad said they did not have hard data on
how much high-deductible plans, including those tied to HSAs, are
affecting their practices, but several said they have seen a marked
increase in their accounts receivable, or money owed by patients, over
the past few months.

Susan Wolf, administrator at Wendover OB/GYN & Infertility in
Greensboro, said she has seen a dramatic increase in patients this
year coming in with high-deductible plans, most with HSAs.

That’s because employers, who have faced double-digit increases in
their premiums each year recently, have latched onto the plans as a
way to control costs.

According to the Kaiser Family Foundation, the number of employers
offering the high-deductible/HSA plans has grown from 2 percent in
2005 to 11 percent last year. The foundation found that patients from
employers with less than 200 workers were twice as likely to be
enrolled in one of the plans.

While the plans cover preventive care at 100 percent with no
deductible, patients can be left to pay the first $5,000 or more of
other treatments or procedures if neither their employer nor they
themselves have deposited money into an HSA.

“We have patients who the last time they had a baby were on a
(traditional plan with a low co-payment or deductible), and this time
they’re getting hit hard,” Wolf said. “I think we’re going to see more
employers have to turn to these plans, but it is getting more
difficult for patients to make that kind of contribution to their
health care.”

Cost-conscious
High-deductible plans tied to HSAs have been around since Congress
approved them as part of the Medicare Modernization Act in 2003. They
were an attempt to encourage cost-consciousness on the part of
patients and increase their out-of-pocket burden.

The thought was that someone with a minor injury, a sprained ankle for
example, might rethink a visit to the doctor that would generate a
bill for office time and X-rays and instead just rest the ankle with
ice at home.

Higher deductibles can also be a viable option for young, relatively
healthy people who don’t anticipate major medical expenses.

Bob Seehausen, senior vice president for business development and
managed care at Novant Health, sits on the board for the state’s
insurance pool for high-risk people with pre-existing medical
conditions. He said $5,000 deductibles are becoming more common for
high-risk people as they try to keep their premiums down.

“We definitely see (deductibles) moving to much higher levels,”
Seehausen said. “What we consider fairly typical today we would have
called catastrophic five years ago.”

While the HSA can help pay some up-front expenses, the IRS in 2009 set
an annual deposit limit of $3,000, meaning a patient might not be able
to completely cover a high deductible during the first year in such a
plan.

According to industry trade group America’s Health Insurance Plans,
the average HSA balance among more than 1.1 million accounts at five
national banks was $1,449.

The group found that 64 percent of all accounts had less than $1,000,
including 12 percent of accounts that had a zero balance.

According to the Urban Institute, about half of all enrollees with HSA-
eligible plans don’t open the accounts. And patients who do have an
HSA aren’t required to use the money if they receive a medical bill.

http://triad.bizjournals.com/triad/stories/2009/06/01/story4.html

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