We now know one of – if not the – major reasons health care cost trends have moderated – people aren’t getting care.
– Physician visits were down 8% year over year
– 77% of people delayed visits to the dentist due to cost
– a quarter didn’t get prescriptions filled due to cost.
All this didn’t happen last year, but the trends seem pretty clear.
As we noted last month, this has been good great news for health insurers, who’ve seen profits soar as medical costs for 2010 came in lower than projections, and that trend continued into this year. That said, at least one – UnitedHealth, is forecasting a return to somewhat higher utilization in the current quarter.
I’m not sure that’s going to happen.
Other than an obvious driver of utilization – fewer people with insurance means more people putting off care of all types – there’s one other factor that is almost certainly contributing to the drop off in demand for services – high deductible accounts. More accurately, accounts that don’t have any funds in them.
According to a report released in January by the Employee Benefit Research Institute, at the end of last year the average balance in HSA accounts dropped to $1355. With the number of accounts increasing about 14% from 2009 to 5.7 million, it’s not surprising that the average balance would drop as new accounts would probably have lower balances than older accounts.
But remember that these accounts are meant to fund care up to the deductible, which can range from a thousand dollars to well over five thousand dollars. If there isn’t enough money in the account to cover the deductible, people may be putting off care to save their dollars for when they really need them.
Oct
20
Interesting my premiums continue to increase theoretically because the specific cap is moving from 1 million to 2 to 4 to unlimited. Im curios what the health outcome will be of reduced medical visits. Im personally against people not having access to care but Im interested in knowing what the reduced visits will mean in real wellness or health of the country.
Depends which visits they aren’t having. Some studies say as much as 30% of healthcare is wasteful, if only those 30% were eliminated we would see no decrease in health and huge savings.
Not haveing Rx filled is not always the end of the world. I have talked to more people in the last 6 months who are weaning of Rx then the last 5 years combined. People are finally waking up to the fact we are over medicated and there are major health concerns that derive from that.
Yesterday I was talking to a member who saw the price of Humira and decided to try fish oil for her arthritis. Technically she didn’t fill it becuase of price but now she is getting the same results from OTC and saving $1500
Question: How significant is the “average balance” of HSAs?
I heard a radio program a few months ago giving financial advice to callers. The host was some sort of financial adviser, obviously with an insurance background. He was a strong proponent of HSAs and described how someone facing an expensive medical outlay could notify the bank and have the appropriate amount cycled through a HSA to get the tax benefit. Perhaps you know if this is feasible and if so how widespread it may be. The result, of course, would be a low balance in the HSA until a medical need presents.