The New Republic laments that the introduction of consumer driven health care in the form of high-deductible, high-copay plans linked to Health Savings Accounts (HSAs) is shifting the cost of health care onto the sick. And he’s right. The good idea of providing consumers with better signals about price and quality has been perverted into a way to shift costs from employers to employees. It reminds me of how pharmaceutical companies gave disease management a bad name in the mid-1990s by making the term synonymous with encouraging the use of medications.
Cost shifting (as described in The New Republic) and expecting consumers to negotiate discounts (as described recently in the Wall St. Journal) are the wrong way to go. It was telling that the Journal article focused on how to nickel and dime their doctors on the small charges and recommended ignoring the big costs –like surgery– because once the big costs kick in consumers blow through their deductibles and are back to traditional insurance, where costs don’t matter.
We need plan designs that help consumers use their shopping smarts to hold down or avoid the big costs and encourage providers to improve service and quality. Let’s not make consumer directed plans a fig leaf for cost shifting and haggling over prices.November 1, 2005