High-deductible health insurance plans are hurting the financial health of small, rural hospitals and their patients, Markian Hawryluk reports for Kaiser Health News.
"Plans with annual deductibles of $3,000, $5,000 or even $10,000 have become commonplace since the implementation of the Affordable Care Act as insurers look for ways to keep monthly premiums to a minimum," Hawryluk reports. "But in rural areas, where high-deductible plans are even more prevalent and incomes tend to be lower than in urban areas, patients often struggle to pay."
When patients can't afford to pay, hospitals must eat the cost of treatment; that has contributed to a "substantial" rise in the amount of uncollectible hospital debt in the past few years. "According to the Healthcare Financial Management Association, hospital bad debt increased by $617 million to nearly $56.5 billion between 2015 and 2018," Hawryluk reports. "According to the National Rural Health Association, bad debt for rural hospitals has gone up about 50 percent since the passage of the Affordable Care Act in 2010." Partly because of bad debt, more than 120 rural hospitals have closed in the past decade and many more are on the brink of bankruptcy.
Rural residents often choose these high-deductible plans for several reasons. Consumers tend to shop for insurance based on monthly premium costs, and gamble that they won't get sick and need to pay a deductible. Others may not understand that they will have to pay the full deductible before their insurance covers bills, Hawryluk reports.
Another problem is the lack of choice. "In many rural counties, consumers shopping on their state’s health insurance exchange had little choice. This year, about 10% of enrollees, living in 25% of counties, many of them heavily rural, will have access to just one insurer in their local Affordable Care Act marketplaces," Hawryluk reports.
Maggie Elehwany, vice president of the NRHA, told Hawryluk that the exchanges were meant to provide people with choices, but "There’s no shopping in rural America. You have one choice."
"Plans with annual deductibles of $3,000, $5,000 or even $10,000 have become commonplace since the implementation of the Affordable Care Act as insurers look for ways to keep monthly premiums to a minimum," Hawryluk reports. "But in rural areas, where high-deductible plans are even more prevalent and incomes tend to be lower than in urban areas, patients often struggle to pay."
When patients can't afford to pay, hospitals must eat the cost of treatment; that has contributed to a "substantial" rise in the amount of uncollectible hospital debt in the past few years. "According to the Healthcare Financial Management Association, hospital bad debt increased by $617 million to nearly $56.5 billion between 2015 and 2018," Hawryluk reports. "According to the National Rural Health Association, bad debt for rural hospitals has gone up about 50 percent since the passage of the Affordable Care Act in 2010." Partly because of bad debt, more than 120 rural hospitals have closed in the past decade and many more are on the brink of bankruptcy.
Rural residents often choose these high-deductible plans for several reasons. Consumers tend to shop for insurance based on monthly premium costs, and gamble that they won't get sick and need to pay a deductible. Others may not understand that they will have to pay the full deductible before their insurance covers bills, Hawryluk reports.
Another problem is the lack of choice. "In many rural counties, consumers shopping on their state’s health insurance exchange had little choice. This year, about 10% of enrollees, living in 25% of counties, many of them heavily rural, will have access to just one insurer in their local Affordable Care Act marketplaces," Hawryluk reports.
Maggie Elehwany, vice president of the NRHA, told Hawryluk that the exchanges were meant to provide people with choices, but "There’s no shopping in rural America. You have one choice."
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