Refining our understanding of value-based insurance design and high cost sharing on children

Abstract

BACKGROUND: There is significant concern about the financial burdens of new insurance plan designs on families, particularly families with children and youth with special health care needs (CYSHCN). With value-based insurance design (VBID) plans growing in popularity, this study examined the implications of selected VBID cost-sharing features on children. METHODS: We studied children's health care spending patterns in 2 data sets that include high deductible and narrow network plans among others. Medical Expenditure Panel Survey data from 2007 to 2013 on 22 392 children were used to study out-of-pocket (OOP) costs according to CYSHCN, family income, and spending. MarketScan large employer insurance claims data from 2007 to 2014 (N = 4 263 452) were used to test for differences in mean total payments and OOP costs across various health plans. RESULTS: Across the data sets, we found that existing health plans place significant financial burdens on families, particularly lower income households and families with CYSHCN; individuals among the top 10% of OOP spending averaged more than $2000 per child. Although high deductible and consumer-driven plans impose substantial OOP costs on children, they do not significantly reduce spending, whereas health maintenance organizations that use network restrictions and tighter management do. CONCLUSIONS: Our results do not support the conclusion that high cost-sharing features that are common in VBID plans will significantly reduce health care spending on children.