The rise of high-deductible health insurance plans under the Affordable Care Act (ACA), nicknamed Obamacare, has led to a rise in unpaid hospital bills among the insured population. This has prompted more hospitals in America to require patients to pay before they are wheeled into the operating room.
Thanks to Obamacare, millions of Americans now have a health insurance plan. Attracted by the lower monthly cost, many people are choosing for the bronze and silver plans, which can carry deductibles of up to $15,000. According to a poll by the Kaiser Family Foundation, nearly half of Americans already have difficulty paying for an unexpected $500 bill. The most widely used Obamacare health plan, however, has a deductible of $6,000 for an individual and double the amount for a family, which is an 18 percent spike compared to 2014, reported Reuters.
Do you know what you’ve signed up for?
Insurance plans can be confusing, leaving many patients puzzled when they find out they must pay thousands of dollars before their insurance kicks in. Often, patients with high-deductible insurance plans do not understand their responsibilities and find themselves unable to pay their share once they leave the hospital.
Jessica Curtis, a senior advisor at Community Catalyst, a consumer advocacy group in Boston, noted that the impact these insurance plans have on patients goes beyond financial issues. Drowning in debt from the deductibles not covered by their plans, some patients skip or delay further care or don’t follow advice on prescription drugs, which usually pushes them further down the lane. Because these people waited to seek medical attention, they often require more expensive procedures after.
More and more hospitals are burdened by bad debt from uncompensated care. Therefore, they are now encouraging individuals with high-deductible plans to pay up front to reduce the growing mountain of unpaid bills. The Henry County Health Center in Iowa is one of the hospitals that recently started to experiment with pre-payment strategies, offering discounts for patients who pay early.
“Most patients are appreciative that we’re telling them up front,” said David Muhs, chief financial officer for the Henry County Hospital. (Related: Read more news coverage of health care plans at HealthCoverage.news.)
The ACA’s plan to shrink debt from uninsured patients has failed dramatically
As reported by Reuters, the ACA insured 20 million more Americans to help hospitals cope with the debt from uninsured patients who could not pay their medical bills. The introduction of Obamacare, however, hasn’t turned out to be the better solution. Because most people already have a hard time feeding their family and paying off mortgages or rent, most Americans opt for Obamacare plans or employer-based health plans with low premiums they can afford. Unfortunately, most of these people do not realize that when they need care, out of pocket costs will be very high. In 2015, U.S. hospitals faced uncompensated medical bills of nearly $36 billion.
One of the first hospitals to change to the pre-paid strategy was Novant Health, headquartered in North Carolina. With four medical centers and hundreds of outpatient and physician facilities, it saw patients’ debts increase dramatically after employers started to provide high deductible health care plans.
New technology now allows hospitals to determine how much a patient will have to pay after treatment, creating more transparency into the procedure. If patients cannot pay their bill up front, some hospitals will recommend financial assistance programs such as payment plans or low-interest loans.
“We are trying to minimize the after-service bill shock and get them into financial assistance or some other program for more affordable care,” said Andy Scianimanico, vice president for revenue cycle at Northwestern Memorial HealthCare, the parent company of Chicago’s largest hospital.
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