Why Consumers Are Ill-Prepared for Health Care Costs

Why Consumers Are Ill-Prepared for Health Care CostsWhy Consumers Are Ill-Prepared for Health Care CostsWith deductibles growing by the year, out-of-pocket costs increasing, and the cost of most medical procedures rising, many healthcare consumers are finding that theyre unable to manage the costs of routine health care. Many are struggling between buying health insurance and putting money into savings plans or even toward other must-pay expenses. The Statistics The Commonwealth Fund conducted a survey from June through November 2018, publishing its findings in early 2019, approximately eight years after provisions of the Affordable Care Act (ACA) began to go into effect in 2010. They found that roughly the same number of Americans ages 19 through 64 were uninsured in 2018 as were in 2010- about 45%, or nearly half. The survey also found that mora people who were covered under employer plans are now underinsured and that those who are underinsured or uninsured are hit with higher , more prohibitive medical bills than Americans with adequate insurance. The High Cost of Routine Medical Care Debt.org reports the following customary prices for some relatively common health care procedures in the U.S. as of 2018 Gastric bypass $25,000Angioplasty $28,200Knee replacement $35,000Hip replacement $40,364Heart bypass $123,000Heart valve replacement $170,000 Thats a lot of money to come out of pocket if youre uninsured, and even if youre underinsured. Average American Savings Bankrate reported in December 2018 that the average American household has only $8,863 saved. Couples tend to save the most, while single parents save the least. Another Bankrate study revealed that one in five Americans dont save anything at all. Compare the numbers. A catastrophic injury or illness can easily wipe out a consumers savings account and plunge him into considerable debt besides. Some Options Some consumers use health savings arrangements (HSAs), health reimbursement accou nts, and flexible savings accounts to put money away for health needs. This is especially attractive for those who are already maxing out their savings to pay for regular medical care and prescription drugs, and for employees who have company matched dollars. But the Mayo Clinic advises that there can be some potential pitfalls with health savings arrangements, including Not everyone has the discipline to set aside money in a savings account.Older people facing health problems already might be on tight, fixed incomes and cant save enough.The pressure to keep money in a health savings account can prevent members from seeking medical care. Consumers arent educated enough on how to best make use of health savings accounts. Funds can sit in an unused account for years, which is a waste of money. Some medical practices refuse to give patients discounts for paying up front for medical costs, even if the patient asks and doesnt want to file a claim with her insurance company. Consumers age d 65 or older cant qualify for health savings accounts. Restrictions apply when both parents work and are eligible for a health savings plan- only one plan is allowed per family and both parents must be enrolled in a high deductible health plan (HDHP). Out-of-Pocket Amounts for HDHPs and HSAs Limits for HDHPs and HSAs are set forth by the Internal Revenue tafelgeschirr each year. Out-of-pocket maximum limits for the 2019 calendar year are Maximum Self Coverage $6,750Maximum Family Coverage $13,500 Health savings account contribution limits for 2019 are Self-coverage $3,500Family-coverage $7,000 Again, theres a wide gap between what consumers can save and what they can afford. Most are unsure of how they would pay for a single significant health claim. How Employers Can Help Ultimately, its up to employers to provide the education and information employees need to be smarter, cost-effective health care consumers. Sending out benefits enrollment information each year isnt enou gh. Companies can educate and support a healthier workforce in several other ways. Hold Educational Sessions Explain benefit costs, coverage amounts, and savings options before open enrollment, during employee onboarding, and during peak risk seasons for health. Center these sessions around themes for saving money on health care and medication, preventing health problems, increasing health savings, and how to select quality care. Provide an Emergency Medical Fund Every company should consider putting aside a medical fund to help employees who are facing catastrophic illness or a major injury. This can be a community fund to which all employees contribute a small amount of every paycheck, or even once a month or so. Reward contributors with company swagger and other perks to keep them active in the plan. Appoint a review committee and a point-of-contact person to allocate funds when theyre needed. Access to Financial Wellness Tools Make saving money a positive goal by sha ring financial wellness tools that help employees track their spending and budgets, rack up savings, and start putting more money into their personal and health savings accounts. Employees are much less distracted and a lot more productive when they feel secure about their financial futures. Secure the Most Affordable Group Health Plan Take responsibility for a portion of the burden of affordable health care. Work closely with medical and voluntary plan administrators to put together group insurance plans that are low cost but offer the best value. Dont shortchange employees by offering plans that dont have good coverage or participate with a wide network of medical facilities. Have an Open Door Policy It can be tempting to let employees self-enroll in benefits after handing them a brochure. Have an expert on hand in your HR department or on call, someone whos ready to answer any questions and define complex health care terminology. Develop and Launch a Corporate Culture Encouraging employees to participate in low-cost screenings versus dealing with expensive serious illnesses later should be an ongoing discussion. Employers can play a larger role in helping employees lead healthier lifestyles by offering onsite wellness support and education. Wearable fitness devices, support groups, and healthy meal options in the workplace can make a huge difference to employees who might be struggling to stay fit and reduce stress. Its not expected that health care costs will ever go down. In fact, theyll likely continue to rise in the coming years. But consumers can get smarter about where they spend their health care dollars and what plans they choose to comply with health care mandates.