Employee Cost-Sharing

The Health Care Cost Institute was formed to collect information from large private health plans and analyze that data to help identify trends and issues.  Because it is a multi-payer database it contains a far larger and more representative data pool.  The most recent brief from the Institute looks at patient cost-sharing.  For this brief the data is all from employer-sponsored insurance plans.  (HCCI Brief)   In these plans, several trends are colliding.  One is the growth in patient grow-sharing; higher deductibles, higher copays, more use of coinsurance.  Another is a recognition that there is significant price variation even within the local health markets where these enrollees receive care and that price variation appears unrelated to quality.  And while there is a lot of talk about price transparency, it remains difficult for most consumers to find and understand information about what they will pay for a specific service from a specific provider.  The issue is gaining in urgency, for example, the out-of-pocket spending by employer-sponsored plan enrollees rose from $662 per capita in 2012 to $707 in 2013, or 7%.  This is obviously well above income growth and the per capita average masks substantial variation–a lot of people have no or little spending, but a minority have much larger spending.  Looking at five common health services, including a physician visit, a colonoscopy, cataract removal, MRI and obstetric ultrasound, the analysis found large variation, which follows through to variation in the out-of-pocket cost.  For example, the national price variation for cataract removal was $2,242 in actual paid amounts.  The typical patient share was 20%, so the difference in out-of-pocket cost to the consumer could be as much as $444.  Even for the office visit, the patient could pay as much $19 more.  This variation analysis emphasizes the need to find some way to get consumers useful, real-time, specific data on what they are going to pay for a service.