Assuring all Americans affordable health insurance is the most fundamental goal of health reform. Families cannot be economically secure as long as they face financial catastrophe when illness strikes. And people cannot lead healthy and productive lives as long as they cannot afford the care they need when they get sick.
Going forward with reform legislation, it is imperative to consider four basic principles.
First, keep an eye on total spending. Affordability depends not only on individual and family premium contributions, but also on deductibles, cost-sharing obligations, and other health care spending. Beware of a desire to keep premiums low by making cost-sharing high. If only some components of family health care spending “count” toward a consideration of what individuals and families can contribute toward their health care costs, some Americans—most likely those with ongoing, chronic illnesses—will continue to grapple with unmanageable and unaffordable health care expenses.
Second, benefits matter. Health insurance worthy of the name has to work for people when they are sick. Despite claims that “any insurance is better than none,” insurance that leaves people without necessary protections is simply not good enough. Adequate benefit packages with a defined set of services are another critical lynch-pin to health care affordability. If a health insurance policy doesn’t cover the services people need when they get sick, it doesn’t provide the financial protection Americans need and legitimately expect from health insurance coverage.
Third, affordability depends on income. Low-income families should be expected to contribute a lower proportion of family income toward their health care expenses, in recognition of their more limited ability to absorb unpredictable health care costs.
Finally, insurance must stop discriminating against sick people. Because premium prices will have a substantial effect on overall healthcare affordability, by extension so will insurance market rules that determine whether rates can vary based on people’s “pre-existing conditions” or other health-related characteristics. As long as insurers can deny coverage, limit benefits or charge higher rates based on people’s age or health status, insurance will remain unaffordable for people who know in advance they need its protections. Meaningful health reform cannot fail to assure that health insurance is affordable for people who have been (or whom insurers believe are likely to become) sick.
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