Knowledge@Wharton: With High-deductible Employer Health Plans, Who Wins?

For a growing number of Americans, high deductible health plans are a fact of life. The trend started a decade ago and shows no signs of disappearing. At many firms, it’s the sole health insurance that’s offered for employees. The assumption is that if employees have to fork over more money when seeing a doctor or filling a prescription, they will have “skin in the game” so they’ll use their health care benefits more selectively and avoid wasteful or unnecessary procedures and drugs. You might put off treating minor ailments like “your achy knee, your cold that won’t go away, or your kid’s earache or sore throat,” says Drexel professor of health management and policy Robert I. Field who is also a lecturer at Wharton. Wharton health care management professor David Asch gives the example of going out to dinner on your own dime versus an expense account. You’ll naturally be more frugal, says Asch, who is also executive director of Penn Medicine’s Center for Health Care Innovation. Similarly, if you have expensive homeowners insurance that only covers catastrophic events, you might be more cautious in your home, “less likely to put the paper towel rack next to the toaster.” (Although hopefully people won’t do that under any circumstances, he says.) Read more at Knowledge@Wharton