High Deductibles

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We heard from some other folks who have taken the time to go on the website. We got a question, for example, from Rose in New Jersey. She said she qualifies for a subsidy, and she actually seems pretty pleased with the premium that she's paying for insurance. But she asked this. She says, "If the purpose of the Affordable Care Act is to ensure all Americans have health care, why do most plans have such a high deductible?"

Well, essentially, what we've done is to create a marketplace for private insurance. And each insurer is pricing it. Some have lower deductibles but that means then it may be a higher premium. Some of them may have higher co-pays but a lower premium. And so what we've tried to do is to say, here are a range of options that are available to you through traditional private providers, and you'll choose what you think is best for you.

Now, obviously, there are other countries that have government-run health care or have a single payer plan, in which case the government really controls much more tightly how health care is distributed. That's not the system we've traditionally had. There are pluses and minuses with having a private insurance system.

But what we have tried to do is to make sure that everybody has a range of options and they can see what's going to be most suited for their family. And some people may say, I'd rather have a higher deductible but lower premiums. Some people may say, you know what, I'm going to use health care fairly often. So I may want to keep my deductibles lower.

Part of why this whole initiative has been so important is, from now on, folks cannot be prohibited from getting health insurance because of a preexisting condition. And that is something that is going to give a lot of people out there a lot of assurance. And I suspect a lot of people who view this program will say, that's a relief for me.

But what we haven't done is ended completely a private insurance system. Although, if you qualify for Medicaid, obviously that whole issue would not apply.

Yes, because we do hear consistently from a lot of people who do feel that the out-of-pocket cost, the deductibles as Rose mentioned, but also the co-insurance and the co-pays that come with it. And in some cases, they're feeling like they really want health insurance but actually going to the doctor just simply becomes too costly for them because they have to lay out, in some cases, $5,000 or $6,000 before getting help, with the exception of preventative services.

Well, the important thing though, Lisa, as I think you're familiar with, is that all these private insurance plans typically have some sort of deductible and some sort of co-pay. And so what we are trying to do is to say, given the marketplace that's out there with private insurance, here's how we're going to help to make sure you can afford it.

And we're also making sure that there aren't lifetime limits. That's true for all insurance plans now. There are a number of consumer protections that we've put in place that assure that people are getting a better deal than they're often getting in the private marketplace. But what I would suggest for most folks is that having good solid insurance with some deductibles and co-pays is better than no insurance at all.

And what I think people will often often find is that if they go on the website, their options are going to be much better than the options that they might get if they were simply shopping on their own in the individual marketplace without deductibles, in which case they might, on paper, look like they're getting great insurance, until they get sick and then they find out that, with all the fine print, it doesn't pay for hardly any of the hospitalization or doctor care that they need.