NCPA - National Center for Policy Analysis


September 17, 2007

High-deductible insurance policies that require the insured to pay thousands of dollars before insurance covers their care may be the key to lowering costs and putting people in charge of their health care, says ABC News.

Five years ago, the grocery chain Whole Foods Market switched to a different kind of health insurance, a policy that puts patients more in control:

  • Whole Foods has an insurance policy with a high deductible; that means an employee must pay about $1,000 before their insurance kicks in.
  • If they get cancer or heart disease, their insurance covers it, but if they have a sore throat or a sprained ankle, they pay.
  • To help workers pay, Whole Foods puts money into an account for them.
  • Some employees got $1,500 this year; if they don't spend it on medical care this year, they keep it and the company adds more next year.

Most companies call these accounts Health Savings or Health Reimbursement Accounts. The company saved money, too. "Our costs went way down," says CEO John Mackey.

Still, some employees were angry about the plan. They said they wanted their full coverage back.

"When you go from a system where people are very dependent and now you're telling them, 'Hey, you have to take more responsibility for your own health.'  And that was frightening to them," Mackey said. "Because they were going to have to be responsible for themselves, they weren't going to be taken care of any longer."

Source: John Stossel, Gena Binkley and Patrick McMenamin, "Health Savings Accounts: Putting Patients in Control; Whole Foods Employees Go Bargain Hunting for Health Care," ABC News, September 14, 2007.

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