Will Large Employers Dump Their Sickest Employees?
A loophole in the federal health care overhaul could allow employers to game the system by getting their sicker employees to opt into buying coverage on the health insurance exchanges, according to two University of Minnesota law professors.
[T]here are several approaches companies could use:
- Limit the number of specialists in a provider network. The exchange could be more attractive to someone who needs a specialist for an expensive chronic condition.
- Couple high premiums with discounts for participating in wellness programs. Employees who are not in the best of health may not want or be able to participate in wellness discounts, such as going to the gym three days a week.
- Raise deductibles and co-pays. Substantial co-pays or deductibles are unattractive for someone who frequently sees a doctor for a chronic condition. High co-pays don’t matter as much for those who see a doctor infrequently.
Source: Kaiser Health News.
So, it would seem, this gives employers the incentive to force out their sickest, i.e., most expensive employees…which is what health care reform was supposed to stop. What a waste!
Economics 101, and basic human behavior. Employers will not only game the system to lower their costs, and in the process not have to pass those higher costs on to all consumers, but also to lower the cost of health insurance for all their other employees. But let’s protect the few and hurt the many. It’s the American way, right?
The incentives are already in place to game the system. When thousands of dollars are at stake, the incentives will be hard to resist.
This is the third loophole I’ve heard about in two weeks. Something about the good ol’ days of reading legislation before you pass it keeps ringing in my ears.
Most likely, it seems!
That article did a good job of explaining some of the loopholes, though I would like to see a more comprehensive list of all of them.
Yes, I think this will happen.