Medical Bad Debt: What’s Behind the Increase?

According to a post on DarkDaily.com, higher employee deductibles on company-provided health insurance might be a contributor to rising medical bad debt levels.

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DailyDark.com sources a survey conducted by Modern Healthcare: Modern Healthcare’s fourth annual Healthcare Purchasing Power Survey.

“Large employers are now experimenting with health plans that combine high deductibles and significant exemptions from out-of-pocket costs for chronic disease management,” according to Paul Fronstin, Director of Health Research and Education Programs.

A few more bullet points from the article:

  • Companies as varied as General Electric, Catholic Health Initiatives, and Tyco have all made the move to shifting more fiscal responsibility for healthcare on to their employees.
  • According to a survey conducted by Kaiser Family Foundation, 12% of workers insured by an employer in 2011 had deductibles of at least $2,000.
  • High deductible plans among large insurers increased by 5% in 2011.
  • The growth in high-deductible plans is even faster among small employers. Kaiser determined that such plans now cover around 28% of insured workers at these companies. That rate is up from 20% just two years earlier.
  • Also contributing to the rising level of medical bad debt: escalating cost of health insurance for workers, high unemployment rate, a record number of home foreclosures, and individual bankruptcies.

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