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Member Research & Reports

Member Research & Reports

IUPUI Researchers Find High-deductible Health Care Plans Curb Costs and Usage

A team of researchers based at the Indiana University Richard M. Fairbanks School of Public Health – Indianapolis has conducted the first systematic review of studies examining the relationship between high-deductible health care plans and the use of health care services. They found these plans reduce both the cost and the use of health care services, according to the Health Affairs article, titled “High-Deductible Health Plans Reduce Health Care Cost and Utilization, Including Use of Needed Preventive Services.”

[Photos: Dr. Nir Menachemi (left) and Dr. Olena Mazurenko]

“Those reductions are the result of a decrease in patient use of many types of medical services, including desirable services like preventive care or cancer screenings,” said Dr. Nir Menachemi, a professor of health policy and management and chair of the department of health policy and management in the Fairbanks School of Public Health, who is one of the authors of the paper.

While high-deductible health plans have lower premiums, they have higher deductibles compared to traditional insurance plans. Many policymakers view high-deductible health plans as a way to curb health care costs by providing patients with incentives to make more cost-conscious health care decisions.

Nearly every health care reform proposal at the state and federal level involves some use of high-deductible health plans to manage costs and patients’ demands for services. Therefore, a synthesis of existing studies provides policymakers with the best available evidence as the U.S. moves toward a system increasingly centered on high-deductible health care plans, Dr. Menachemi explained.

“For high-deductible health plans to work in the ideal, patients need to be educated on the fact that preventive care does not usually incur out-of-pocket costs in these types of plans,” Dr. Menachemi said. “Few, if any, high-deductible health plans charge members for preventive screenings, suggesting patients didn’t understand they could use these services at no cost.”

The review highlighted the decline in use of preventive health care services under high-deductible plans, which another study has shown occurs when patients change their health care behavior and forgo needed care to save money.

“Traditional insurance plans shield patients from all of the financial decisions that are made. The fact that you are shielded financially from health care decisions makes you potentially more likely to over-consume services, which raises the average of care for everyone and increases premiums for everyone.”

Evaluating the most rigorous methodological studies previously published, the review summarized findings across 28 articles. High-deductible health plans were found to be associated with a significant reduction in preventive care in seven of 12 studies and a significant reduction in office visits in six of 11 studies — which in turn led to a reduction in both appropriate and inappropriate care.

The full article was recently published in the October issue of the Health Affairs journal, and is co-authored by Mr. Rajender Agarwal, director of the Center for Health Reform in Dallas, Texas, and a student in the Business of Medicine MBA program at IU’s Kelley School of Business at IUPUI, and Dr. Olena Mazurenko, an assistant professor of health policy and management at the Fairbanks School of Public Health.