People with these health plans struggle to afford care

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Myles Ma, CPFCSenior ReporterMyles Ma, CPFC, is a senior reporter and certified personal finance counselor at Policygenius, where he covers insurance and personal finance. His expertise has been featured in The Washington Post, PBS, CNBC, CBS News, USA Today, HuffPost, Salon, Inc. Magazine, MarketWatch, and elsewhere.

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People with high-deductible health plans are more likely to struggle paying for medical care, according to a survey of adults with employer-provided health insurance. Many people with higher deductibles don't have enough savings to cover the full amount of their deductible.

A deductible is how much you pay for health care before your insurance kicks in. Deductibles can be as high as $6,650 a year for an individual or $13,300 for a family. Many people who were surveyed said the amount of savings they could quickly access was less than half of that.

High deductibles & debt

The Kaiser Family Foundation and the Los Angeles Times based the survey on interviews with a nationally representative sample of 1,407 people from the ages of 18 to 64 who reported having health insurance from an employer or union. The interviews were conducted from Sept. 25 through Oct. 9.

About half of respondents with high deductibles said they wouldn't be able to afford a bill equal to the full amount of their deductible without going into debt. They would either put it on a credit card and pay it off over time (27%), set up a payment plan with the provider (17%) or borrow money from a bank, payday lender or friends and family (5%). One in six said they wouldn't be able to pay the bill at all.

Health savings accounts

High-deductible health plans are often paired with health savings accounts, which let you set aside money tax-free to pay for medical expenses, including deductibles. Few people save much money in HSAs, the survey found. About half of people with HSAs say they contributed less than $1,000 in the past year and only 31% say they have at least $2,000 saved in the account.

How to get the most out of an HDHP

High-deductible health plans are becoming more popular. More than 40% of Americans with employment-based coverage had high-deductible plans in 2017, up from about 15% in 2007, according to the National Center for Health Statistics. While these plans come with higher deductibles, they also have lower premiums. Because of this, people with high-deductible health plans typically pay less overall then people with low-deductible plans, research shows.

But they put more of the onus on consumers to realize those savings. Here are a few ways to get the most out of an HDHP:

  • Use an HSA: You can use an HSA to save for medical expenses. Contributions and withdrawals, as long as they're for medical expenses, are tax-free. You can invest any remaining balance to help save for retirement.

  • Compare prices: Shop around for the best price for medical services using health care price transparency tools like Fair Health or Healthcare Bluebook.

  • Negotiate: If you get a big medical bill, you can talk to the provider about lowering what you owe or paying in installments. Also make sure to discuss costs with providers before paying for services.

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