I’ve written before about the idea that segments of the healthcare system where patients pay for themselves may be a fertile focus for innovation because of the tight connection between “who pays” and “who benefits”. News today reinforces this hypothesis, suggesting there are actually quite a few of these potential customers.
1. The Wall Street Journal today has an article describing the changing world of primary care, and highlighting various new models, including a number in which the patient pays a portion of the cost (for example direct-pay primary care, and concierge medicine).
2. The Kaiser Family Foundation has a survey of employer health benefit plans (for 2012). It surveys 2,121 firms, and uses statistical techniques to try and generalize the findings to the universe of all of the 3M+ US firms. My key takeaway: there are lots of patients who pay non-trivial amounts out of their own pockets. See below.
Employer insurance factoids
Among a number of interesting factoids, one gleans the following from reading the KFF survey.
- Average annual premium for family coverage: $16K.
- Premium contributions by the worker average 28% for family coverage (18% for single coverage). So a typical, head-of-family worker would be personally responsible for premium payments of $4K+ per year.
- Employers are the principal source of health insurance in the US, providing health benefits for 149M non-elderly people.
- 39% of firms that offer health insurance include a HDHP/SO* plan option (ie a High Deductible Plan, in which the patient bears a significant portion of costs for care).
- 20% of covered workers are enrolled in HDHP/SOs, and this is the second most common option, after PPOs (56%) and above HMOs (16%).
- There is substantial cost sharing beyond the premium contributions. For example, the average family deductible for HDHP/SOs is $4K.
- And overall, 34% of covered workers are in plans with single deductibles in excess of $1K.
- And then there are copays.
My takeaway from these factoids is that there are at least 50M people who are responsible for the first $1K or more of their healthcare costs (as deductibles), and roughly 20-30M people who are responsible (on average) for more like $4K of initial healthcare costs. And in both cases, copays mean they are actually personally responsible for greater sums.
This seems like an interesting target Petri dish for innovations that suit circumstances in which the patient is the “customer”.
*HDHP/SO=High Deductible Health Plan with Savings Option
- More Employers Offering Consumer-Driven Health Plans: Survey (insurancejournal.com)
- John Goodman