By CQ HealthBeat Staff, CQ Roll Call
March 11, 2015 -- About a quarter of non-elderly U.S. households do not have enough liquid savings to pay the annual mid-range deductible for a private insurance plan, raising the prospect that many Americans could forgo care, according to a new Kaiser Family Foundation study.
While concerns about cost-sharing are not new, the study notes that coverage expansions under the health care law have put a new focus on defining affordable coverage. Family expenses can easily exceed $10,000 when someone becomes seriously ill, the study notes.
"The goal of the law was to cover more of the uninsured, many of whom have limited means," the study's authors note. "The issue for some families ... is that the policies with affordable premiums may have cost-sharing requirements that would be difficult for them to meet when they access services."
The study uses Federal Reserve data to compare households' liquid financial assets with cost-sharing representative of health plans offered by employers or available on the individual market, including in health law exchanges.
Researchers found 32 percent of lower-income households have sufficient liquid resources—defined as bank accounts, CD's and stocks—to pay a $1,200 annual deductible for an individual or a $2,400 deductible for a family. Only 20 percent of those households can afford an annual deductible of $2,500 for an individual or $5,000 for a family. The cohort is defined as having income of 100 percent to 250 percent of the poverty level, or $11,770 to $29,425 for an individual.
The study also found 38 percent of moderate-income households lack the liquid savings to cover a mid-range deductible. Moderate-income is defined as 250 percent to 400 percent of the poverty level, or $29,425 to $47,080. Because the health law doesn't provide cost-sharing for this group, individuals would have to borrow money or become indebted to health providers if they get seriously ill.
The study found less than half, or 47 percent, of households without enough assets to pay deductibles could obtain $3,000 from friends or family to help in an emergency.
