The Incidental Economist is passing along an interesting study that looks at how people respond to co-pay changes for treatments of acute crisis:
A study just published in JAMA Pediatrics looked at how children with asthma obtained care under different levels of cost-sharing, and how much stress their families were under financially because of their child’s illness. It’s important to understand that children with asthma, by definition, require care.
We want them to use the health care system. With respect to asthma, prevention and maintenance are far better than trying to treat a child already suffering from an attack.
What we see from this study is that families with higher levels of cost-sharing were significantly more likely to delay or avoid going to the office or emergency room for their child’s asthma. They were more likely to have to borrow or cut back on necessities to afford care. They were more likely to avoid care.
This isn’t a good outcome. We’re talking about children with a completely manageable chronic condition who are being hampered by cost-sharing. That’s not what cost-sharing is supposed to do.
This is why I don’t think high deductible health plans or HSAs are a good policy solution. They work reasonably well as true insurance products. They are horrendous at the health maitenance component of health insurance. As I’ve said before, HSAs and HDHPs can be an appropriate health insurance offering for a small class of people:
If I was the health insurance dictator in this country, I would allow high deductible plans to be sold. They would only be sold to individuals and families who are reasonably young (age is a pre-exisiting condition) without any signifcant claims history. The policies would not be automatically renewed until the most recent claims and medical history was reviewed. Furthermore, the potential buyer pool would be limited to people who have the ability to absorb a one-time shock of several thousand dollars without it being a crisis. This sub-population is fairly small, and can absorb the risk shifting that is inherent in a high deductible plan design. Anyone with chronic conditions or recurring health maitenance problems should not be a plan designed like this
If we assume that there is a general public policy goal of promoting good health at reasonable cost, then the obvious solution is to redesign out healthcare delivery and financing systems to account for reality instead of theory. The obvious solution with plenty of real world comparables is some type of regulated public utility model of healthcare delivery plus social service enhancement plus collective single payer or regulated public utility payer systems mostly funded by general taxation. Every other OECD country can make it work better and cheaper, so there are easy gains available. However, I don’t think we’ll get to a national single payer or single payer-like system before my almost 2 year old can rent a car without surcharge, so I’ll be posting on a couple of second and third best kludges over the next week.