Unanticipated Healthcare Costs Can Hurt More than Insurance Premiums
The decline in the number of insurers who offer policies is resulting in increases in costs for corporations and for consumers AND unexpected bills.
As of 2014, the market share for the top 4 insurers is 84% and this percentage is increasing. According to Leemore S. Dafny, a professor of the Bruce V. Rauner Professor of Business Administration at Harvard Business School, BlueCross BlueShield covered nearly 52 percent of all lives in the US followed by UnitedHealthCare (13 percent), Aetna (11 percent), and Cigna (6 percent). With continued mergers in the field, this is increasing.
If you look at things on a state by state basis, the concentration of insurers is worse. According to Dr. Martin S. Gaynor, E.J. Barone University Professor of Economics and Health Policy at Carnegie Mellon University, this high degree of concentration is leading to markets controlled by just one or two players. In 2014, the two largest insurers had 70% or more of the market, half of all metropolitan areas. Since that time this percentage has steadily increased.
Both professors agree, with insurance renewals coming up, and fewer companies in the market, consumers can expect higher premiums. Gaynor, who has studied the effects of mergers has noticed that when consolidation occurs, premiums have increased between 8% to 14%, post-merger.
Employers and Employee, sensitive to higher prices, are more willing to select narrow-network plans. Narrower networks mean less choice and longer wait times. When you need immediate attention, you have to look outside your network for help. These Unexpected medical bills top the list of health care costs Americans are afraid they will not be able to afford.
Four in ten people saying they had received a surprisingly large invoice within the past year, according to a new poll. For those under 65, Thirty-nine percent of insured adults said they had received a medical bill within the previous 12 months they thought would be covered but wasn’t or was higher than anticipated. Half of those people said the bill was less than $500, but nearly 1 in 8 said they were on the hook for $2,000 or more.
Most of these people attributed their large bills to going out of network. An in-network doctor must accept the remuneration your insurance company pays. If a patient sees an out of network provider, they are responsible for paying the difference between what the insurance company will pay and what the out of network provider charges.
Another poll recently conducted by NORC at the University of Chicago, a research group, found similar numbers of people had received a surprise bill. The most common charges were for a physician’s service or a lab test. For example, when people go to emergency rooms they often don’t realize that they will receive a separate bill from the doctors who take care of them.
When costs become unaffordable, often times providers will negotiate payment plans. Sometimes, they may waive a portion of the excess fees charged. If needed, it never hurts to ask for financial help.