Charleston Post and Courier
July 17, 2017
South Carolina customers who buy their insurance through the federal marketplace may face some of the highest out-of-pocket increases for their health insurance if the Senate plan to reform the Affordable Care Act is passed, a recent analysis by Families USA found.
Families USA, a liberal consumer advocacy group, analyzed 11 states and found a majority of South Carolinians who buy private insurance on HealthCare.gov could soon find their deductibles unaffordable. A deductible is the cost built into every health insurance plan that represents the amount of money a customer must chip in before their insurance covers most of their health care costs.
Some “high deductible” plans require customers to pay thousands of dollars out-of-pocket before the insurance company pays their claims.
If the Senate bill becomes law, 83 percent of marketplace enrollees in South Carolina would see their deductibles go up by an average of $5,060, Families USA predicted. That would be the greatest increase related to deductibles among the states the report analyzed.
“This is a very harmful impact of the Senate bill that has not received so much discussion,” said Stan Dorn, author of the analysis. “People need to understand that in South Carolina, for more than 4 out of 5 marketplace enrollees, deductibles are going to skyrocket.”
Families USA predicted that deductibles would go up under the Senate plan for two reasons. One, the bill would cut some of the tax credits that help people buy health insurance through the Affordable Care Act. And two, the bill would only fund “cost-sharing reductions” through 2019. Those reductions were established by the Affordable Care Act to help low-to-middle income customers cover some insurance costs, including co-payments and deductibles.
Ray Farmer, director of the South Carolina Department of Insurance, said he has been watching the issue closely. He is more worried about funding for the cost-sharing reductions, which President Donald Trump’s administration has recommended funding on a month-to-month basis. He called the provision in the Senate bill that would extend the cost-sharing reductions through 2019 a “great step.”
Farmer, a member of Gov. Henry McMaster’s Cabinet, warned of drawing conclusions about the reform plan before it is passed. But he said South Carolina consumers can expect to pay more if the cost-sharing reductions are not funded.
“We just need some certainty in the funding of it,” he said.
More than 183,000 customers in South Carolina buy insurance through HealthCare.gov and most of them qualify to receive some level of the cost-sharing reductions.
Some customers some will avoid the expense of health coverage altogether if the Senate bill becomes law, Dorn said. Others will choose not to use their insurance because their deductibles may be too high, he said.
Even before the Affordable Care Act became law, deductibles were on the rise, according to the Kaiser Family Foundation.
The Foundation reported in 2016 deductibles were rising almost six times faster than wages.
Reach Mary Katherine Wildeman at 843-937-5594. Follow her on Twitter @mkwildeman.