Financial Burden of Employer-Sponsored High-Deductible Health Plans for Low-Income Adults With Chronic Health Conditions

High-deductible health plans have increased significantly over the last decade.¹ Adults in low-income families or with chronic health conditions are more likely to face high out-of-pocket spending on health care as a percentage of family income when they are enrolled in high-deductible health plans, compared with adults in higher-income families or healthier adults.^2,3 The extent of the financial burden at the national level of high-deductible health plans among adults who are low income and have chronic health conditions is not well-known.⁴ This study examines the prevalence of high out-of-pocket health care spending across health plans with different deductible levels among adults in low-income families who have chronic conditions.

We used 2011-2015 Medical Expenditure Panel Survey Household Component data on adults 19 to 64 years of age enrolled in employer-sponsored insurance plans throughout the year. The main sample focuses on low-income adults (family income <250% of the federal poverty level). We identified 20 chronic conditions based on the classification method developed by the Office of the Assistant Secretary of Health in the US Department of Health and Human Services (hypertension, congestive heart failure, coronary artery disease, cardiac arrhythmias, hyperlipidemia, stroke, arthritis, asthma, autism spectrum disorder, cancer, chronic kidney disease, chronic obstructive pulmonary disease, dementia [including Alzheimer disease and other senile dementias], depression, diabetes, hepatitis, HIV, osteoporosis, schizophrenia, and substance abuse disorders [drug and alcohol]).⁵ We examined treated conditions, defined as conditions for which individuals reported receiving any medical care. We defined family out-of-pocket health care financial burden as the ratio of total annual family out-of-pocket spending for health care services and premiums divided by total annual family disposable (after-tax) income, and used a 20% financial burden (family out-of-pocket health care burden exceeding 20% of family disposable income) as a measure of high burden.^2,6 Health plans were categorized as high deductible if the deductible levels exceeded the Internal Revenue Service threshold for high-deductible health plans, categorized as low deductible if deductibles were below that threshold, or as no-deductible health plans otherwise. All comparisons were made using 2-tailed t tests and results were deemed statistically significant at P < .05. This project has received approval from the Agency for Healthcare Research and Quality institutional review board.

Among all adults (n = 33 619), the prevalence of a 20% burden was 7.3% (95% CI, 6.4%-8.3%; P < .001) for those enrolled in a high-deductible health plan vs 5.9% (95% CI, 5.2%-6.6%; P = .001) for those enrolled in a low-deductible health plan and 4.3% (95% CI, 3.7%-4.9%) for those enrolled in a no-deductible health plan (Table 1). Among low-income adults with no chronic condition or only 1 chronic condition, the prevalence of 20% burden among those enrolled in a high-deductible plan was 20.6% (95% CI, 16.6%-24.6%; P < .001) and the prevalence of 20% burden among those enrolled in a low-deductible plan was 17.5% (95% CI, 15.0%-20.0%; P < .001), compared with 11.0% (95% CI, 8.5%-13.4%) among those enrolled in a no-deductible plan. The prevalence of 20% burden was higher among low-income adults with 2 or more chronic conditions, at 46.9% (95% CI, 37.5%-56.3%; P < .001) for those enrolled in a high-deductible plan and 36.9% (95% CI, 31.3%-42.5%; P = .001) for those enrolled in a low-deductible plan, compared with 22.0% (95% CI, 14.9%-29.0%) among those enrolled in a no-deductible plan. The differences in burden across deductible levels remained similar when sociodemographic factors and self-reported health status were controlled for. Among low-income adults, those with high-deductible or low-deductible plans were more likely to face 20% burdens than those with no-deductible plans among individuals with diabetes (42.4% [95% CI, 27.8%-57.1%]; P = .005; and 31.9% [95% CI, 24.5%-39.3%]; P = .03; vs 19.1% [95% CI, 10.9%-27.4%]) and those with hypertension (38.2% [95% CI, 29.6%-46.8%] and 31.5% [95% CI, 26.4%-36.6%] vs 18.0% [95% CI, 12.6%-23.4%]; P < .001) (Table 2).

Among low-income adults enrolled in employer-sponsored insurance who had multiple chronic conditions and were enrolled in high-deductible health plans, almost half (46.9%) had a family out-of-pocket health care burden exceeding 20% of family disposable income. Although only 22% of the overall low-income population had full-year employer-sponsored insurance, their financial burden is of concern because, owing to the fact that they have offers of employer-sponsored insurance, they are likely not eligible for the premium and cost-sharing subsidies in the health care Marketplace that other adults in this income group can access. Moreover, they may not be eligible for Medicaid depending on their income and whether their state expanded Medicaid. For clinicians and patients, high out-of-pocket costs for low-income adults with employer-sponsored insurance may create a barrier to achieving effective treatment to manage multiple chronic conditions.

Accepted for Publication: July 22, 2018.

Corresponding Author: Salam Abdus, PhD, Division of Research and Modeling, Center for Financing, Access, and Cost Trends, Agency for Healthcare Research and Quality, Department of Health and Human Services, 5600 Fishers Ln, Rockville, MD 20857 (salam.abdus@ahrq.hhs.gov).

Published Online: October 8, 2018. doi:10.1001/jamainternmed.2018.4706

Author Contributions: Dr Abdus had full access to all of the data in the study and takes responsibility for the integrity of the data and the accuracy of the data analysis.

Concept and design: Both authors.

Acquisition, analysis, or interpretation of data: Both authors.

Drafting of the manuscript: Abdus.

Critical revision of the manuscript for important intellectual content: Both authors.

Statistical analysis: Abdus.

Obtained funding: Abdus.

Administrative, technical, or material support: Abdus.

Supervision: Abdus.

Conflict of Interest Disclosures: None reported.

Disclaimer: Any opinions and conclusions expressed herein are those of the author(s) and do not necessarily represent the views of the Agency for Healthcare Research and Quality or the US Department of Health and Human Services.