'Hidden' health care costs can sneak up on patients, study says

Having health insurance does not always mean health care is affordable. In addition to premiums, there are a slew of costs to contend with -- from deductibles and co-payments to uncovered therapies and medicines.

A 2011 study from the Deloitte Center for Health Solutions in conjunction with the Deloitte Center for Financial Services ("The Hidden Costs of U.S. Health Care for Consumers: A Comprehensive Analysis") takes a closer at these lesser-known costs of health care and their effects on Americans.

The problem

Consumers spent about $363 billion more on health care in 2009 than what official government numbers suggest, according to the study. The culprit? A rise in out-of-pocket medical costs. The victims? Primarily those with medical problems, seniors and their caregivers. Here are some expenses that Americans are shouldering on their own:

  • Deductibles: For those with health insurance (particularly those with private health insurance), opting to pay higher out-of-pocket costs is a way to keep rising premiums from spiraling out of control. In 2004, the average family deductible on the individual market was $2,220, according to the U.S. Department of Health and Human Services. By 2007, that average had risen by nearly one-fourth to $2,753. In other words, families are taking a gamble -- high deductibles reduce premiums, but can leave families footing the bill if they need a lot of care.
  • Uncompensated care for the sick and elderly: Health care costs for those 65 and older accounted for more than one-third of all health care expenditures. And much of the cost of long-term care is shouldered by family, rather than by health insurance. Unpaid caregivers shelled out $199 billion in 2009 to care for sick and elderly friends and relatives, according to the study.
  • Non-traditional medicine: Some patients choose to pursue non-traditional remedies and treatments that aren't covered by health insurance. A health savings account (HSA) can let patients set aside money tax-free to spend on more flexible care, but that money still comes out of their own pockets.

The consequences

The high costs of care could generate bigger problems, according to the study, as well as some creative solutions.

High out-of-pocket costs could motivate patients to delay needed care to avoid going further into debt. Yet those costs also could encourage them to seek less costly care. For example, the study found that there is a "growing awareness" of alternative and over-the-counter products. Moreover, consumers seem to be more willing to use generic drugs than they were several years ago. These findings could suggest that consumers are taking on a more proactive role in managing their health care -- and finding ways to afford it.

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