New research out from Accenture takes a look at how employees are using the health insurance exchanges now that Obamacare is in full swing. Accenture estimates 40 million people will get their health insurance on the exchanges by 2018. Research shows given an array of options, consumers are willing to trade benefits in exchange for lower monthly premiums.
Early predictions on how individuals would choose health insurance options once prompted to move to the exchanges noted some of the trends reflected in the study. Specifically, insurance providers themselves have already narrowed their networks to keep costs low. Now, individuals are also trading away what’s left of that flexibility for still lower premiums. Over half – 57% of those that opted to trade use the premium price cut to add other benefits like dental or vision.
“What we’re seeing here is a shift in responsibility for determining coverage from the employer to the employee. For the first time, employees can tailor their coverage closely to their real needs which wasn’t always possible with employer provided plans,” Rich Birhanzel, managing director, Accenture Health Administrative Services explains in an interview with CivSource.
The data shows that while employees are willing to make some tradeoffs in return for lower premiums, their willingness will depend on the availability of other options. For example, an Accenture survey of more than 2,000 U.S. consumers showed that 81% of employees would be willing to increase their deductible to save $50 a month on their premiums. However, only 25% of employees surveyed would be willing to accept more than a $600 deductible increase to save $600 in annual premiums.
The real question is what all of this means for the healthcare system as a whole. Slicing and dicing coverage doesn’t do much to bring the overall cost of procedures down. Coverage trade-offs that look good to consumers in the short term, like adding dental, are only great until a significant medical event happens and they’re stuck with the tab. “We need to improve the amount of information available with the exchange data, so people can make informed decisions,” Birhanzel says.
Private exchanges could also support efforts by a number of states to improve healthcare price transparency. “I think the presence of exchanges is accelerating the adoption of price transparency,” Birhanzel notes. Several states are working to get providers to offer patients a fee schedule so they can make informed decisions about care, some providers have done this on their own, prompting others to get into the mix. The next phase for healthcare in America will be to determine ways to bring overall costs down in a real way, instead of just simply telling people how broke they’re going to be when something happens. But, baby steps.