May 19: 'Deductible relief day'
The date marks the time of year when the average person with employer coverage satisfies their deductible.
The Kaiser Family Foundation (KFF) has declared May 19 “Deductible Relief Day,” as a way of bringing awareness to a growing issue with high-deductible health plans. Cost-shifting by employer-based plans, originally hailed as a way to make consumers smarter shoppers for health services, have become problematic as Americans on these plans report struggling with affordability when it comes to accessing health care services.
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“We set out to estimate the time of year when the average person with employer coverage satisfies their deductible and how that has changed over time,” the new report said. “This year, we estimate “Deductible Relief Day”—the day when enrollees have on average incurred enough health spending to hit the average deductible in an employer plan–will fall on Sunday, May 19, 2019.”
Five months of out-of-pocket costs
That day used to come earlier—KFF estimates that in 2006, Deductible Relief Day fell on February 28. Just last year, the “holiday” came five days earlier, on May 14. The study notes that unlike copays and coinsurance costs, deductibles spending hits consumers at the beginning of the year. For those in high-deductible insurance plans, this reality may mean they need significant savings to start the year in order to cover medical costs.
“Over the last decade, deductibles have become an increasingly prominent component of employer-sponsored coverage,” the report notes. “In 2007, when enrollee out-of-pocket costs were much less concentrated on deductibles and more so on copays and coinsurance, out-of-pocket spending was spread much more evenly throughout the year.”
More people are paying deductibles
The KFF report noted several ways high deductible health plans have become more common, and have caused more financial stress:
- Deductibles are rising. In 2009, the average deductible was $533 for a single person. In 2018, it was $1,350, an increase of over 150 percent.
- More people have to pay them. In 2018, about 85 percent of covered workers were enrolled in an employer plan with a deductible, compared to 59 percent a decade earlier.
- People are paying more. Average enrollee spending on deductibles has more than tripled from $130 in 2007 to $411 in 2017. Overall, out-of-pocket health spending among people with employer coverage has gone up from $493 in 2007 to $792 in 2017, with much of the increase taking the form of higher spending on deductibles.
KFF recently released a major survey, conducted with the Los Angeles Times, on how high deductibles are affecting workers with employer-based insurance. This latest report underlines other ways high deductibles have changed the equation for employer-based health care coverage.
“Deductible Relief Day provides a way to think about how rising deductibles affect household budgets,” the report adds. “In 2019, over a third of the year has passed before the average enrollee has incurred enough spending to meet the average deductible. As many enrollees do not have sufficient assets to be able to pay a typical deductible, these higher, more concentrated costs can lead to delayed or forgone care and difficulty paying medical bills.”
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