Cancer Today

High-Deductible Gamble

High-deductible health insurance plans can leave cancer patients scrambling to pay the bills for tests and treatments. (2016)

By Charlotte Huff

Tammy Pope had already exceeded her health insurance plan’s $5,000 deductible for 2015 by August. She was still facing a double mastectomy for stage III breast cancer when she got into a debate with her oncologist over whether she could skip a magnetic resonance imaging (MRI) test of her brain. The doctor had recommended the MRI because Pope had been falling down, episodes she blamed on her cancer medications.

But the doctor insisted on the scan, saying the malignancy had already proved unexpectedly aggressive, with 23 positive lymph nodes removed during Pope’s lumpectomy. “She said, ‘We don’t know for sure if it has spread, and it does love going to the brain,’” as Pope recalls the conversation. “Of course,” Pope adds, “when they put it like that, you’re going to do it.”

Pope, a retail worker in Louisville, Kentucky, was already fielding bills she couldn’t pay for tests that had led to her triple-negative breast cancer diagnosis, as well as the chemotherapy that treated her cancer but left her with severe neuropathy in her hands and feet. And while the MRI showed no signs of brain metastasis, the bills kept multiplying: slightly more than $600 for her portion of the MRI’s cost, roughly $6,500 for various tests that led to her diagnosis, and at least $20,000 for her share of the cost of chemotherapy. (Even after Pope met her $5,000 deductible, she had to pay a percentage of each bill under the terms of her insurance policy.) Discussing those figures in early December 2015, a day before her double mastectomy, the 52-year-old noted that come January 1, 2016, her deductible would kick in again.

High-deductible plans, once a rarity in health insurance, have become more common. Nearly half of Americans on employer-provided insurance, 46 percent, were required to meet an individual deductible of at least $1,000 in 2015, compared with 10 percent in 2006, according to a Kaiser Family Foundation/Health Research & Educational Trust annual survey. In addition, the average deductible has increased, from $917 for individual coverage in 2010 to $1,318 in 2015.

Because high-deductible plans are relatively new, individuals might not understand the out-of-pocket ramifications unless they get a serious diagnosis, says Peter Ubel, a physician and behavioral scientist who studies health care decision-making. But signs of strain are starting to emerge, says Michael Diaz, an oncologist in St. Petersburg, Florida, and director of patient advocacy for a practice with 200 oncologists. “It’s causing problems because they [the high-deductible plans] are interfering with what we [doctors] would normally routinely want to do,” says Diaz, referring to delayed diagnoses or patients pushing for different treatment because of high-deductible worries.

Diaz described a middle-aged woman seen at the practice who had put off getting a lesion growing on her head checked out because of the out-of-pocket cost. By the time she reached an oncologist’s office, the squamous cell lesion was large enough that she needed to undergo radiation in an effort to reduce its size before surgery could even be considered, Diaz says. Another patient, a man in his 60s diagnosed with advanced prostate cancer, asked that chemotherapy be postponed for two months until the following January. The patient’s rationale: He’d only max out his $5,000-plus deductible in a single year rather than in two consecutive years. But, says Diaz, “he’s delaying what would be considered optimal therapy.”

Deductibles: A High Hurdle

With the exception of some preventive measures like flu shots or screening mammograms, patients on high-deductible plans typically must pay for all doctor visits, lab work and other medical care until the deductible is met. Along with becoming more common through employer-provided insurance, high deductibles also are a feature on many plans sold through the Affordable Care Act health exchanges. And that’s just part of the burden for many patients. Plans vary in the amount they will pay once the deductible is met, with some covering everything and others just a percentage.

A Kaiser Family Foundation analysis reveals how daunting high deductibles can become if serious illness strikes. Overall, 63 percent of adults under age 65 have enough financial resources on hand—via bank accounts, certificates of deposit, nonretirement mutual funds and stocks, among other assets—to meet a $1,200 deductible for an individual and $2,400 for a family. For the higher deductible—defined as $2,500 for an individual and $5,000 for a family—51 percent have sufficient funds, according to the analysis, published in 2015.

Another study, conducted by the nonprofit organization Families USA, looked at nonemployer health insurance coverage in 2014 and found that adults with a high deductible were more likely to skip care. Nearly 30 percent of adults with a deductible of at least $1,500 reported forgoing care versus 19.6 percent of those with a lower deductible.

To some users, high-deductible plans can feel like scant protection, says Ubel, based at Duke University in Durham, North Carolina. “You think that you’ve bought health care insurance,” he says. “And what you’ve really bought is insurance that will eventually kick in when you need a heck of a lot of health care.”

Despite tales of patients delaying or refusing tests or treatments because of high deductibles, it’s still unclear whether or in what way these plans influence cancer patients’ decisions, says Frank Wharam, an internist and a researcher at Harvard Medical School in Boston, who is leading a large-scale breast cancer study that’s trying to gain better insight into whether the deductibles can be linked to delays in diagnosis or altered treatments. “There is this tension and open question about whether the costs of cancer diagnosis and care are so high among high-deductible members that women will delay care, versus, is cancer such a scary and concerning potential diagnosis that women will not delay care no matter what the cost?” he says.

The study, funded by the National Cancer Institute and the National Institutes of Health, uses data from a large health insurer to compare the timing of diagnosis and treatment decisions for about 175,000 women ages 25 to 64 on high-deductible health plans with the timing of those decisions made by a similar number who were on traditional employer-provided coverage. The study, which began in 2013, is comparing time intervals for the two groups, including how long it takes the women to get tests required for a diagnosis; how much time they take to undergo surgery, chemotherapy and other treatments; and the length of time from diagnosis to death. Researchers hope to publish initial results in late 2016, according to Wharam.

Care Has a Cost

Penny Aicardi says she worried far more about her cancer diagnosis than her $3,000 health insurance deductible when she learned in early 2014 that she had papillary thyroid cancer. “You hear ‘cancer’ and you think, ‘I don’t care what it’s going to cost. I want to live,’ ” says the 45-year-old public relations specialist and mother of two living near Worcester, Massachusetts. Aicardi had slipped on ice and injured her head and neck; subsequent tests led to an ultrasound and biopsy of her neck. The tests revealed she had thyroid cancer. During surgery to remove her thyroid in April 2014, 15 nearby lymph nodes were removed, all of which tested positive.

In April 2015, after she had been treated with radioactive iodine to target any remaining cancer cells, tests showed no evidence of disease. That’s when Aicardi realized the bills wouldn’t stop, that she could face several thousand dollars in expenses annually for ongoing monitoring, including periodic body scans and the costly injections she’d need prior to the scans. “Going forward, you really have to start weighing, ‘I can’t keep paying thousands of dollars every year,’ ” she says.

Aicardi was one of more than 13,000 people with cancer and other illnesses who responded to a 2014 online survey by Inspire, a Princeton, New Jersey-based company that hosts online patient communities. An open-response section reaped some heated feedback regarding deductibles. One50-year-old cancer patient described her $10,000 annual deductible. “We can’t seem to recover before another year begins,” she wrote. Another mentioned the difficulty of meeting a large deductible due “almost immediately in the first quarter of the year.”

Pope, who earns $20,000 annually, was on short-term disability in the latter half of 2015 as she first went through four rounds of Adriamycin (doxorubicin) and Cytoxan (cyclophosphamide) and eight weeks of Taxol (paclitaxel). Pope had noticed the lump during a breast self-exam, which meant that the follow-up mammogram—typically covered in full under a high-deductible plan as a preventive screening—was classified as diagnostic and thus added to her bill, she says.

The tests required to diagnose Pope’s breast cancer—mammogram, ultrasound and biopsy—cost $6,500, surpassing her $5,000 deductible. But her insurance covered only a portion of her costs above the deductible, requiring her to pay between 20 and 40 percent of each bill even after she reached $5,000 in expenses, she says.

Shortly after her double mastectomy, Pope was set up on a payment plan of $25 monthly. “I’ve got so many bills coming in, so many people calling me,” says Pope, whose husband died in 2006 and who has custody of an adult disabled son and a 9-year-old grandson.

Unintended Consequences

Wharam says high-deductible plans became more common starting a decade ago, as employers and insurers searched for ways to counteract rising health care costs. Some economists and other experts also believed the model would be an incentive for patients to shop around for medical care based on cost and quality and thus improve the health system, he adds.

A recent analysis that looked at a large company’s experience after shifting employees and family members into a high-deductible plan found that the move reduced annual health care spending by its employees roughly 13 percent. How were those savings achieved? Those enrolled sought out fewer medical services rather than searching for less costly treatment options, according to the findings, published in a National Bureau of Economic Research paper in October 2015.

Diaz, the St. Petersburg oncologist, has started asking patients whether they have a deductible and if they’ve met it for the year to help prevent any billing surprises. For example, he might need to order a test to monitor the status of a patient’s cancer even if it’s currently in remission, he says. “This test may sometimes cost well over $1,000 and they’ve got to pay for it out of pocket,” he adds, “and then they get angry with me because I sat there and ordered an expensive test.”

Aicardi, who built a spreadsheet during her thyroid cancer treatment to track costs and insurance payments, found herself in 2015 dreading a whole-body scan she might need to check for signs of cancer recurrence. The cost of the scan and Thyrogen (thyrotropin alfa) injections given prior to the test would total just over $4,000, according to the amount recorded on her spreadsheet for her 2014 scan. But the rest of her family also had looming expenses, such as a son on the verge of needing braces.

In the end, her doctor said she didn’t need the whole-body scan. But Aicardi, who these days is driving a school bus part-time because she found the long hours of her public relations job too wearying, won’t need to factor in a high deductible the next time she makes a decision about her health care.

Her husband got a new job in late 2015, in part because of their stress surrounding health insurance. “We saw long term that this kind of insurance was not going to work for us,” Aicardi says of their previous high-deductible plan. The new job offered two insurance options, including one without a high deductible. The decision, she says, was self-evident.