The Two-sided Coin of High Deductible Health Plans

January 23, 2017
Angela Watkins

How high-deductibles and copays are straining, but also strengthening, the trust between doctors and patients.

As far back as 2001, insurance companies began introducing high-deductible health care plans, increasing the amount patients pay for healthcare before their insurance benefits pick up costs. While many believed this would keep healthcare costs down by eliminating unwarranted visits to the doctor's office, it has resulted in complicating the patient-physician relationship.

A 2016 joint survey by the Kaiser Family Foundation and The New York Times found that about one-quarter of adults aged 18 to 64 said someone in their household had trouble paying medical bills in the previous 12 months. The report showed that among those who had insurance, 75 percent said that the amount they had to pay for the insurance copays, reach the deductible or pay in coinsurance was more than they could afford.

Physicians and their staff are now finding it necessary to dedicate additional time with patients to discuss insurance coverage and out-of-pocket costs.

According to Michael Munger, family physician, president-elect of the American Academy of Family Physicians (AAFP), high deductibles add to the complexity of a physician's relationship with patients and can present barriers to care, especially when patients delay important medical care or skip preventive services that are covered by their health plan without having to first meet the deductible or copay.

"When patients delay important medical care, this can result in the physician, especially primary [care] physicians, responding more reactively," said Munger, who practices in Overland Park, Kan.

However, Munger added, there is a positive side effect for the patient-physician relationship to these high-deductible health plans. "It is helping to open the lines of communication even wider, enabling physicians and patients to discuss the benefits of proactive care," he said.

Communication is paramount

Ken Ostermann, an OB/GYN at Beaver Dam Women's Health, a women’s health clinic located in Beaver Dam, Wisc., argued that insurers currently value only things that can be measured - not relationships. While high deductibles and copays might have an initial negative impact on the patient-physician relationship, Ostermann says he and his staff are able to connect with patients in new ways that add value to the relationship.

"Sometimes we serve as translators, helping patients understand exactly what their insurance policies cover," explained Ostermann. "In other ways, we serve as counselors when explaining options to the patients."

Communication between patients and physicians are being adjusted to discuss financial concerns. Ostermann adds, "While there are courses in medical school that deal with bedside manner when communicating with a patient, there are no courses focusing on communication when it comes to billing and collection etiquette."

Effective communication and cost transparency lead to shared decision making, according to Osterman. For example, patients might ask about a generic drug instead of using a name-brand drug.

Both Ostermann and Munger say open communication, which includes effective listening and cost transparency, is helping to cement the trust that already exists in the patient-physician relationship.

"Patients trust that physicians are on their side when it comes to medical costs," says Munger.

In a recent letter to President-Elect Donald Trump, the AAFP said it looked forward to working closely with the new administration and the 115th Congress to ensure that all Americans have access to high-quality, efficient health care. The AAFP also emphasized the need for policies that value primary medical care and protect patients from financial barriers to needed services, including the elimination of financial obstacles to securing primary and preventive care, especially those individuals who have high-deductible health plans.

Lost in translation

As Ostermann notes, physicians and their staff have taken on the role of translators - explaining to patients exactly what their health insurance does, and doesn't, cover. While many insurance companies go out of their way posting information on their websites, patients are seeking that one-on-one relationship with someone who can explain in easy-to-understand terms the details of their plans.

In a 2016 patient survey by The Physicians Foundation, respondents said they find it more difficult to understand their health insurance now than before the Affordable Care Act was passed. Just over 43 percent say they rely on their physician to help them understand how the ACA impacts quality of care, while nearly 50 percent say they rely on their physician to understand what the insurance does and doesn't cover.

Translating insurance policies so that patients understand what is covered and not covered is one of the more difficult aspects of the patient-physician relationship.  Ostermann says physicians and office managers often are unable to explain all the nuances of patients' health plans to them. While the medical office staff tries to find answers to questions posed by patients, Ostermann says it should be the payers' responsibility to make sure patients fully understand the policies they purchase.

Knowing the costs

Derek Kosiorek, CPEHR, CPHIT, a principal for the Medical Group Management Association's (MGMA) Health Care Consultants, says cost transparency for covered services by a payer is paramount, but often complicated. This is due to the fact that there can be a delay between the insurance company receiving the bill from the physician, data is entered into their system, and a final determination of cost to the patient.

"Because the software is not fluid and relies on data input by the insurance companies, both patient and practice management staff might not know how much of the deductible has been met," he says.

Most practices already have a "traditional" collection process in place that, according to Kosiorek, looks something like this:

• 30 days: an invoice is sent to the patient;

• 60 days: a phone call is placed to the patient who has not paid; and

• 90 days: the matter is turned over to a collection agency. 

Many practices are now training and dedicating an additional staff member to deal with insurance follow-up and the patient's payment responsibility. Kosiorek recommends putting a payment policy in place that lets your patients know what you expect from them financially. The policy should include:

• Handling of copayments and deductibles;

• Payment for non-covered services; and

• Handling of balances and delinquent accounts.

With regard to non-covered services, Osterman adds, "It also seems insurance companies are interjecting themselves more and more into the patient physician relationship. They claim not to practice medicine. However, their frequent refusal to not cover certain services and care can greatly impact the intended medical care a patient receives."

Because messaging needs to be uniform when requesting payment, some practices develop scripts for employees to use, which enables them to become more comfortable when speaking to patients. "No physician wants to lose a patient in a dispute over insurance coverage," says Munger.

For both Ostermann and Munger, costs have never been the primary focus of the patient-physician relationship. However, transparency and honest communication with patients continues to be one of the cornerstones in their practice.

Currently, neither physician experienced a drop in patient volume last year. In fact, both predict that the patient-physician relationship will flourish in the coming years as value-based health care continues to evolve, seeing patients as whole, complex human beings and not as separate objects that need "fixing."

 "One of the more difficult aspects of the patient-physician relationship is that we (physicians and our office managers) often can't explain all the nuances of patient's insurance products to them," said Ostermann. "Often, we find their insurance coverage to be quite convoluted, and it really should not be our responsibility to explain this to them."