ObamaCare vs. Consumer-Driven Care


A fair amount of evidence suggests that consumer-driven health plans, which typically pair high-deductible insurance with health savings accounts (HSAs), offer one of the most promising mechanisms for controlling the growth of health insurance premiums as well as overall health spending. Naturally, it looks like ObamaCare's insurance regulations will impact people with consumer-driven plans more than others, and make it hard for CDHP plans to survive.

According to a new study prepared for the American Bankers Association (ABA) by analysts from the consulting group Milliman, high deductible health plan costs are likely to increase faster than on other types of plans thanks to new rules governing health plans' medical loss ratios (MLRs), which require health insurers to spend at least 80 or 85 percent of their total premium revenue on federally defined clinical services. One reason why the MLR rules are expected to hit CDHPs is that they don't count HSA dollars, despite the fact that high-deductible plans are often matched with HSAs. That makes it harder for the the high-deductible plans to meet the MLR standards. That could have consequences for many of the roughly 10 million individuals enrolled in such plans: In a statement, the ABA warned that "consumers who rely on HSA-qualified plans to finance their health care may experience greater costs in their current health plans and may eventually have to find more expensive replacement coverage."

Study link via John Goodman of the National Center for Policy Analysis. More on ObamaCare's MLR regs here and here

NEXT: Top 1 Percent Pay 37 Percent of Income Taxes

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. man, I sure wish I could find a bi lover somewhere. Hopefully someone will come along very soon and let me know where I can find them.

    1. you could always talk to shadow_man from the TEH GHEY MEIRRAGE!!!1!!11!! thread. But word to the wise, if his comments on polygamy are any indication, he ain’t down with a threeway.

    2. happy Valentine’s day! Do you wanna look for some bilover to hook up tonight?===Datebi*c/O’m=== is a site for bisexual and bicurious singles and friends.Here you can find hundreds of thousands of open-minded singles & couples looking to explore their bisexuality.sign up for free.

  2. Yep, I just got the notification yesterday that my high deductible health care plan premium increased 18% this year. Thanks Obama.

    1. Mine increased too, but not by that much. It’s still the best option for pretty much anyone. There are very few scenarios where you end up paying more under these plans than under other plans. It will be a shame to see them go…

      1. [Looks around, adjusts monocle]

        I don’t pay any premiums in my HD/HSA. Just the HSA contributions.

        Of course, we’re self-insured.

        1. I must be more risk-averse than you. I’ll always carry a high-deductible plan to cover catastrophes.

          Do you actually have enough saved up to cover getting hit by a heart attack / bus?

          1. Oh, I have coverage in a high-deductible plan. I just don’t pay the premiums for it; my employer does.

        2. I’m actually the other way around. I don’t pay the HSA contributions, the employer generously puts that $2000/year in (although I know that comes out of what my pay would be otherwise). I pay a portion of the HDHC premium.

    2. Who do you think is going to pay for the Birth control pills, the pre-existing sob stories and the 26 year old “children” who are now insured?

      The insurance companies? HAHAHAHA.

      Sorry, we get fucked, the insurers just get more money and then send donations to Obama to get re-elected.

      Rinse, repeat.

  3. In Soviet Russia, consumer care drives YOU!

  4. Yup, it’s pretty much impossible to get a CDHP w/ HSA if you’re self-employed. (They were essentially phased-out by Obamacare, though I can score an individual plan, albeit without the tax benefits, and at roughly 2x what I was quoted for monthly premiums for the self-employed options that were, pre-Obamacare, proliferating.) These days, your only real option is Aetna.

    But that’s cool. I heard on the Federal News Radio that gubmint workers are really enjoying their new HSA option!

    /Fuck them. SRSLY. Fuck them.

    1. I won’t be able to put my full LASIK on my FSA next year. Jerks.

      1. I don’t get the point of FSA’s at all. What is the advantage of an FSA over an HSA? My last employer had an FSA that doesn’t roll over. An HSA encourages long term saving not just year to year planning for routine purchases.

        1. I’d take the HSA if that was an option, but it’s not, so an FSA is the best substitute. However, thanks to Obamacare I won’t be able to put in the full amount for the LASIK I want to get next year.

          1. Good luck with the LASIK. I did it back in 2005 and it was the best money I ever spent. By far.

        2. You can have an HSA only with a high deductible plan. The FSA can accompany any other kind of plan. The FSA still lets you use pre-tax dollars for healthcare expenses but you do have to use it or lose it. Yes, the HSA is better if you can afford the high deductible.

          1. Yes, the HSA is better if you can afford the high deductible.

            But that’s the point. If you’re a youngish guy*, the only three problems you’re likely to run into are: ya get by a bus, you develop an itch in your nether regions that must be treated, or as a result of a DUI/possession, you have to attend rehab classes. An HSA where you’re just taking $30 pre-tax out of your paycheck each week–$10 for the plan, $20 for your HSA–means you’ve got the deductible all set, along w/ free preventative care, and when you’re over 40, the money’s there to take care of your prostate or whatever. Even if you’re waiting tables, switching jobs now and again (not that anyone’s switching jobs in this economy), that’s a fantastic deal, and it’s just about the best investment you can make… when you can.

            *Hell, I’m almost 40 and a smoker, pre-Obamacare, I was looking at $50 a month for an HSA/CDHP plan, though of course they know self-employed people don’t go to the doctor much.

          2. For most people it seems like the HSA is best. It is certainly the cheapest if you have few expenses. If you go catastrophic it is about the same as other plans (deductible + premiums – plan HSA contributions, if any). The only time it doesn’t seem to work out is if you end up spending somewhere near your deductible.

    2. I just did it.

      Plan started Jan 15.

    3. So did GoldenRule get legislated out of existence?

  5. Because this is a rehash of the same shit as always, I will just say this: Chronicle is very good. The final battle that starts at the Space Needle is great, and for those of us in Seattle, there are a lot of great location shots, including driving down 6th Ave at Bell looking at the Space Needle and a shot from 99 northbound at the cityscape.

    I can’t figure out where the courtyard with the spear statue is supposed to be, though.

    1. You usually have good scifi taste so I’m surprised to hear this. I may have to reconsider and give it a chance.

      1. It’s really more of a “troubled teen” movie than a scifi movie. The scifi aspect is just a vehicle to give them power to start to abuse. But it’s done very well, and the pacing is great; never a dull moment.

        1. I’m 23. Why would I want to watch a movie about teenagers abusing power?

          Unless they’re 18. And female. And you define “power” loosely.

    2. I’m glad to be hearing good things about it. I want it to be good. I just like the premise. Who hasn’t imagined what they would do with superpowers?

      1. I have imagined it. Many times. I’m a simple man, with simple desires. I just want to rape the moon until it cracks in half.

        1. Why don’t you just start with the Space Needle and work your way up to the moon, over time.

          1. A man has to have standards.

          2. The risk that the Space Needle contains flowers or candy is too high. The moon is safe and barren.

  6. Who could have foreseen this?

    1. RC?

  7. In a lot of ways, I think that this is the worst effect of the law. Or at least the most obvious to the most people bad effect. Basically eliminating the only sensible insurance option for people who don’t get coverage from work.
    I wonder if I should even bother switching to a HSA plan now.

  8. The HSA plan is still a good idea. The premiums for my high deductible plan are higher this year than last and it is no longer the least expensive option offered by my employer. But I figure that being able to sock away as much money as I can in the HSA is a good thing.

    1. Assuming thyat you actually get to kee;p the monehy in the account. With my empoloyer, you forfeit any money you don’t spend within a year.

  9. Naturally, it looks like ObamaCare’s insurance regulations will impact people with consumer-driven plans more than others, and make it hard for CDHP plans to survive.

    I suspect that is by design. Effective healthcare plans would interfere with the move to “single-payer” which is the Progressive Holy Grail.

  10. I don’t see how anybody could have reasonably expected Obama to have done much more to harm our economy–I think he really did his level best.

    I’m not somebody that has much faith in the power of prayer, but let’s all pray anyway that the supreme court puts the whole fucking thing out of our misery.

  11. Don’t these people know it’s their duty to buy overpriced insurance that they don’t need, so as to subsidize health care expenses for the less fortunate?

  12. My wife and two children and I live in the state of Illinois. Our current health insurance plan is a Choice Plan that is provided by “Penny Medical” . The plan itself is a consumer driven health care plan.

Please to post comments

Comments are closed.