Many households do not have enough money to pay cost-sharing typical in private health plans

Health plans use cost-sharing (deductibles, copayments, and coinsurance) as incentives for enrollees to use services efficiently and to shop for lower cost options when they do need care. Cost-sharing that is too high, however, can discourage enrollees from getting the care that they need or drive them into financial distress and even bankruptcy. Enrollees in private health insurance plans may have to pay thousands of dollars to meet plan deductibles, coinsurance and copayments.

To evaluate whether people can afford to pay cost-sharing amounts common with private insurance plans, this analysis examines data from the 2019 Survey of Consumer Finances. It finds that large shares of non-elderly households do not have enough liquid assets to meet typical plan cost-sharing amounts. For example, 45% of single-person non-elderly households could not pay over $2,000 from current liquid assets, and 63% could not pay over $6,000. Lower-income households were much less likely to have the liquid assets to meet typical cost sharing.

The analysis is available through the KFF-Peterson Health System Tracker, an online information hub that monitors and assesses the performance of the U.S. health system.

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