With high deductibles, some drop insurance and pay cash
San Francisco Chronicle
Ed Lee routinely negotiates for his own health-care services, everything from the cost of a scan to an urgent-care visit — often securing discounts of 30 to 50 percent off the original charges.
Lee, 61, who lives in Palo Alto, Calif., and is a self-employed public-relations expert in the semiconductor industry, started bypassing his health insurance and paying out of pocket last year when he realized that premiums and deductibles were costing him more than $ 12,000 before his insurer paid a dime.
With that decision, Lee became part of a new breed of health-care consumer — people who pay such a large portion of their health costs that they’re questioning the value of insurance. And because they’re footing so much of the bill, they feel they owe it to themselves to get a decent price.
Sometimes that means shopping around for prices for blood work or offering to pay cash for a procedure in exchange for a discount.
Lee’s advice is simple: Just ask.
“Every time I’ve asked,” he said, “I’ve gotten some sort of discount.”
Patients, especially those covered by their employers’ health plans, used to be sheltered from much of the costs of health care because they paid little more than a co-payment.
But more employers are shifting toward high-deductible policies or requiring employees to pay a percentage of each health service they receive. In addition, an increasing number of self-insured consumers find they can afford little more than catastrophic coverage.
“We’re on the cusp of a very significant transition to consumers being very concerned about costs,” said Dr. John Santa, director of the Consumer Reports Health Ratings Center, a research arm of Consumer Reports magazine.
In Lee’s case, he opted to drop his insurance as of June 30. He said he never came close to reaching his $ 5,200 deductible, even during a year in which he had two bouts of pneumonia.
“I know it’s a huge risk, but I felt I was just flushing the money down the toilet,” said Lee, who has no spouse or dependent children who need coverage.
Financial and health experts don’t advise going Lee’s route. Health insurance, even with high deductibles, can protect consumers from financial ruin and prevent providers or the general public from being stuck with patients’ unpaid medical costs. Insurance offers access to low- or no-cost preventive care.
Still, U.S. health-care costs, which now amount to $ 2.6 trillion and constitute 18 percent of gross domestic product, are rising faster than inflation — and that’s likely to continue. Insurers and employers are shifting an increasing share of costs to consumers leading up to 2014, when the industry will undergo major changes under the federal health law.
So some people are deciding to negotiate their health services on their own.
Some companies offer services to help consumers figure out how much doctors, labs and hospitals charge for their services.
Castlight Health, a San Francisco company founded in 2008, helps people covered under a certain type of employer plan shop for health-care services to keep deductibles low.
Healthcare Blue Book of Nashville, Tenn., uses industry data from large employers to calculate a fair price and allows consumers to look up a fair market cash price for medical procedures, diagnostic tests, medications and other services by ZIP code.
“You should always understand what the fair price of care should be and ask about your price before you get your care,” said Dr. Jeffrey Rice, chief executive officer of Healthcare Blue Book. “If it should cost $ 500 and someone’s trying to charge $ 2,000, you might want to consider other options.”
(Victoria Colliver is a San Francisco Chronicle staff writer. Email firstname.lastname@example.org. For more stories, visit scrippsnews.com.)
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