Research Finds Out-of-Pocket Costs Varied Greatly Among 10 Health Insurance Plans

Developing New Measures of the Adequacy of Private Health Insurance Coverage

From April 2008 through June 2009, researchers at the Georgetown University Health Policy Institute assessed coverage under 10 health plans in Massachusetts. The researchers applied the rules of each health plan to simulated claims for breast cancer, heart disease and diabetes.

For each disease scenario, the research team calculated how much each plan would pay for each step in the treatment process and how much would be left for the patient to pay.

The 10 plans offered a range of deductibles and co-payments. Under Massachusetts law, the plans had an annual out-of-pocket maximum of $5,000. However, one plan, available only to young adults, capped covered benefits at $50,000 annually.

The researchers reported their findings and recommendations in Coverage When it Counts: What Does Health Insurance in Massachusetts Cover and How Can Consumers Know? posted on RWJF’s website in May 2009. Consumer Reports cited the research in a feature article on coverage gaps in its May 2009 issue.

Key Findings:

  • Consumer out-of-pocket costs under the hypothetical scenarios varied greatly for the three diseases.
  • Numerous factors—some not obvious to consumers when they are choosing a plan—affected the differences in out-of-pocket costs. They include comprehensiveness of the out-of-pocket limit; waivers of cost-sharing and exclusions.
  • Detailed policy contracts would pose challenges to consumers, even if they were to be made available before purchase, due to missing information about covered services and confusing and even ambiguous language in the contracts.

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