Growing number of workers enroll in high deductible health plans

(Washington, D.C.) – The Employee Benefit Research Institute (EBRI) today published an Issue Brief entitled, “Recent Trends in Patient Out-of-Pocket Cost Sharing,” revealing that the share of out-of-pocket costs paid by patients increased from 17.4 percent in 2013 to 19 percent in 2019. This result appears to be driven by the growing number of workers enrolling in plans with higher deductibles. The study analyzed data from over 45 million patients covered by employer-sponsored health care plans.

 “We found that out-of-pocket costs for patients rose between 2013 and 2019 overall. Interestingly, this seems to be driven by the increasing adoption of plans with higher deductibles, and not by changes in cost-sharing. In fact, when we separated the study by individual plan types, such as high deductible health plans (HDHPs), preferred provider organizations (PPOs) or health maintenance organizations (HMOs), we found that the share of out-of-pocket expenditures for patients in those plans have either decreased or remained stable,” explained Jake Spiegel, research associate, EBRI.

Key findings in the study include:
• The share of out-of-pocket costs paid by patients with employer-sponsored health plans increased from 17.4 percent in 2013 to 19 percent in 2019, before a pandemic-related decline to 16.4 percent in 2020.
• However, disaggregating the data by health plan type reveals a more nuanced story: for most plan types, the share of expenses paid by patients out of pocket has been stable or decreased modestly. The increase in the share of expenses paid out of pocket observed between 2013 and 2019 appears to be driven by the growing number of workers enrolling in plans with higher deductibles.
• Between 2013 and 2019, out-of-pocket expenditures for outpatient services grew faster ($470 to $631) than out-of-pocket expenditures for inpatient services ($109 to $127). The out-of-pocket expenditures for prescription drugs declined during this period ($158 to $148).
• Patients’ health conditions affect how much they spend out of pocket.  For instance, the median patient with high cholesterol had higher expenditures than patients in general ($882 vs. $205) and paid a higher share of their expenditures out of pocket (16.9 percent vs. 16.2 percent). 

“Employers face a tension between controlling the bottom-line impact of health care costs and helping workers achieve financial wellness. On the one hand, employers are more frequently implementing financial wellness programs as a means to improve their employees’ financial wellbeing. On the other hand, in an effort to wrangle health care cost increases, employers often turn to raising their health plan’s deductible, potentially offsetting the positive impact of any financial wellness initiatives.” said Spiegel.

The study made use of the IBM® Marketscan® Commercial Claims and Encounters Database containing member enrollment information, as well as adjudicated medical (inpatient and outpatient) and pharmacy claims. For this analysis, claims data from 2013 through 2020 was examined. Overall, the analytical dataset contains records on over 45 million patients who were continuously enrolled in an employer-sponsored health plan at least one year between 2013 and 2020. In total, patients in the database accounted for $998 billion in claims between 2013 and 2020, covering inpatient and outpatient encounters as well as prescription drug claims.

The complete Issue Brief, “Recent Trends in Patient Out-of-Pocket Cost Sharing,” can be viewed by visiting https://www.ebri.org/oop-costsharing .

This Issue Brief was supported by a grant from the FINRA Investor Education Foundation and was conducted by the EBRI Center for Research on Health Benefits Innovation, which receives funding from Aon, Blue Cross Blue Shield Association, FINRA Investor Education Foundation, ICUBA, JP Morgan Chase, Pfizer and PhRMA.