When Cynthia Edson learned how much her husband’s employer-provided health- insurance plan would change in 2014, she compiled a to-do list.
Get a skin-cancer check and an appointment with a gynecologist.
Renew and fill the family’s prescriptions.
Schedule a blood draw for her husband and youngest daughter.
Edson sprang to action because her husband’s employer drastically changed its health-insurance plan for 2014.
Citing the nation’s new health-care law, the company switched to a high-deductible plan that won’t pay for medical care until the family spends $4,000 out of pocket.
So, like many others in Arizona and elsewhere, Edson is cramming in all of the health care she can to take advantage of her more generous plan that ends Dec. 31.
“We’re trying to get everything we can get done right now,” said Edson, of Chandler. “We’re not the only ones feeling this pressure. We’re competing with everyone else who is doing the same thing.”
Doctors, insurers and health-care analysts say the rush to use medical benefits before the year ends is a real phenomenon.
Consumers try to get all of the health care they need before newer, less- generous plans start.
Or they schedule non- emergency “elective” procedures toward the end of the year, after they’ve met deductibles that require them to spend $1,000 or more before coverage kicks in.
Such high-deductible plans are a popular choice for employers seeking to share costs with employees.
About two out of five workers who received health insurance through an employer had a deductible of at least $1,000 this year, according to an annual Kaiser Family Foundation and Health Research & Educational Trust survey of more than 2,000 large and small employers.
National surveys suggest that corporations have been shifting health-care costs to employees for years by raising premiums, co-payments or deductibles.
The Kaiser poll found that the cost of the typical plan rose 80 percent over the past decade, but the worker’s contribution increased 89 percent over that same time period.
Still, employers paid an average of $11,786 per family plan in 2013, while the worker’s share was $4,565.
University of Arizona College of Public Health professor Daniel Derksen said such costs become a competitive issue for businesses, and some companies may see the health-care-reform law as a strategy to offset rising costs for health insurance.
“It’s always nice to have a villain to blame,” Derksen said. “These days, it’s easy to blame ‘Obamacare.’ ”
Proponents of the Affordable Care Act insist that the law should not trigger major changes to employer- provided health insurance, but some companies have cited the law as a catalyst for converting to high-deductible plans, charging more for coverage, or dropping coverage for part-time workers.
United Parcel Service cited the law as one reason it is eliminating health insurance for about 15,000 spouses who have coverage options elsewhere. Retailers Home Depot and Trader Joe’s both dropped coverage for part-time workers, sending those employees to government-run marketplaces.
The health-care law requires companies with 50 or more employees to provide affordable health insurance or pay a penalty.
The mandate is for employees who work at least 30 hours per week, and it does not take effect until Jan. 1, 2015.
But next year, employers must pay a “reinsurance” fee that will be used to stabilize rates in the new online marketplaces, and many employers are citing that fee as a factor for charging more, covering less or a combination of both. A national survey by Aon Hewitt suggests that the Affordable Care Act’s taxes and fees add 1 to 2 percent in direct costs to employers.
Phoenix Children’s Hospital said in a letter to employees that it must pay a $409,000 insurance fee under the health-care law.
Such fees prompted the hospital to scale back less-expensive plans and raise health-insurance premiums for many employees.
Still, the Phoenix hospital offers employees a range of choices.
Many other companies are considering giving employees just one option for health insurance.
The Aon Hewitt survey found that 44 percent of companies are considering offering workers just one health-insurance plan — a high-deductible plan — rather than offer a high-deductible plan plus a more traditional plan that covers 70 to 80 percent of medical costs.
Gannett Co., Inc., which owns Republic Media, the parent company of The Arizona Republic, is among the companies that will offer only a high-deductible insurance plan.
Health-insurance executives describe high- deductible plans as “consumer-driven” because they make employees responsible for a larger share of their health-care costs.
These plans are often coupled with health savings accounts, which allow employees to put away pretax money that can later be spent on medical care.
Such plans theoretically encourage consumers to make smarter choices and skip care that isn’t necessary.
“That is what a consumer plan is designed to do — it pushes more accountability to employees,” said Denise Jewell, a principal with Mercer, a benefits-consulting firm with an office in Phoenix.
Other experts say that while the Affordable Care Act’s direct expenses are limited, the law gives companies an excuse to scrutinize how much they are spending and make changes.
“Small and large businesses are going to look at this as an opportunity to really think about health-insurance benefits they are offering to employees,” said Derksen, the University of Arizona professor. “Business decisions will be made about what is the best value. Are they really getting the value they expect with the amount they are paying?”
Family plan
Edson’s family gets coverage through her husband’s employer, Atlanta-based HD Supply. The Edson family now has a plan that covers 70 percent of medical costs.
HD Supply, which employs about 15,000, switched to a high- deductible plan combined with a health savings account.
“At the beginning of 2014, most remaining measures of the Affordable Care Act will kick in, and HD Supply is keeping pace with these new compliance measures to make sure you and your family continue to have access to affordable, quality health care,” the company’s enrollment package states.
Edson said her family’s monthly premium will be slightly less expensive, but they will pay more out of pocket.
She said she will search for a generic cholesterol medication to replace the brand-name drugs that cost $470 for a 90-day supply.
She also will ask her family’s doctors how much they charge for a routine visit.
She did not have to worry about such costs with her existing plan, which charges a $35 copay for a primary-care doctor’s visit.
People have the option to decline their employer’s insurance plan and choose a plan on the new government-run marketplace at healthcare.gov.
But those people will not get government subsidies if their company offers affordable health insurance, defined as costing less than 9.5 percent of income.
And such employees would lose their employer contribution to their plan, unless the company agreed to provide such a payment in lieu of coverage.
Edson is planning now to make sure her family does not miss out on needed health care. But she expects many others with high-deductible plans will forgo needed medical care over pocketbook concerns.
“When you make a doctor’s visit and know you are going to pay $35, you are more likely to go to the doctor,” Edson said. “When you don’t know how much it will cost you, you will put it off.”
Delayed care
Hospitals and doctors have noticed that with plans that require employees to pay a greater share of their health costs, some consumers are delaying non- emergency procedures until they reach their deductible.
Damon Adamany, a hand surgeon with the CORE Institute in Phoenix, said his office sees a late-year surge of patients scheduling surgery for arthritis or carpal-tunnel syndrome because they have met their deductibles.
“At the end of the year, we definitely see a mad rush,” Adamany said. “I generally don’t take my vacations around the holidays. That is generally when we are the busiest.”
Yet he warns that delayed care can worsen health problems. A person with carpal- tunnel syndrome, for example, may ignore the pain, but “the longer a nerve is being compressed, the more potential damage can be done.”
Mayo Clinic said that historically, the number of patients seeking surgical procedures at its Arizona facilities has grown 5 percent to 10 percent each year. This year, those figures have been flat.
William Stone, who leads the clinical practice at Mayo Clinic in Arizona, said the high- deductible plans are partly responsible.
“The way that costs are shifted with people paying a higher premium or deductible, it’s had some impact,” Stone said. “We’ve seen our volumes decrease because of that.”
Experts on employee benefits say that engaging employees in their health care helps keep costs in check.
Employers routinely encourage workers to take physical exams and biometric screens that gauge health risks.
Based on these measures, companies may financially reward or penalize workers.
Several surveys suggest that Americans are keeping health costs in check.
Health costs routinely spiked at double-digit rates over the past decade but have risen at moderate rates over the past three years.
Aon Hewitt said that metro Phoenix costs increased just 2.9 percent in 2013, but it projects that costs will increase 6.7 percent in 2014.
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