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HPC preview: rising deductibles and unpredictable bills drive consumer affordability concerns; staff outline policy options
Summary
Research presented to the Health Policy Commission found patient cost sharing in commercial coverage rose from 2019–2023, with deductibles now 58% of cost sharing and high-deductible enrollment rising from 19% (2014) to 45% (2023). Staff highlighted how deductibles create unpredictable bills even for routine care and proposed design changes including shifting some deductible dollars to fixed co-pays and removing cost sharing for primary care.
The Health Policy Commission on Tuesday previewed its 2025 health care cost trends report and highlighted worsening consumer affordability driven by rising deductibles, the commission’s research team said.
"Cost sharing refers to the portion of health care costs that the patient pays directly," Sarah Sedanic, deputy director of the research and cost trends team, told commissioners. Staff showed analyses from the all-payer claims database demonstrating that patient cost sharing grew faster than insurer-paid spending between 2019 and 2023 and that the deductible is now the predominant form of cost sharing, representing about 58% of total patient outlays in 2023.
Key findings: researchers reported that the share of commercial enrollees in high-deductible health plans rose from 19% in 2014 to 45% in 2023, and the distribution of annual out-of-pocket spending is wide: roughly 10% of commercially insured members now pay $3,000 or more in a year, and the share paying $5,000 or more has doubled since 2019. Staff emphasized that even routine primary care encounters can trigger large, unpredictable bills when associated lab or imaging services are subject to the deductible.
A clinical example staff used was bacterial vaginosis testing: a patient who pays a typical $25 office co-pay and $10 for a prescription may still receive a $200–$400 bill later if a lab test is applied to their deductible. Research staff said that unpredictability undercuts patients’ ability to plan and can drive avoidance of needed care.
Policy options and modeling: presenters discussed options to make cost sharing more predictable and consumer friendly without changing total actuarial value. One approach is shifting dollars from deductibles into fixed co-pays so a patient would know the cost in advance; staff modeled scenarios in which holding deductible spending to $500 would raise premiums about 6% (offsettable by targeted price limits or other levers) and an alternate scenario eliminating deductible spending for primary care would increase premiums about 0.3%.
Staff also highlighted existing public and private pilots: the Connector’s pilot with no deductibles for primary care-related services, private insurer products that set fixed episode co-pays (an offering called Shorest was cited), and employer contracting models that replace patient cost sharing for employees. "Cost sharing should be predictable in advance of receiving a service," Sedanic said, arguing that predictable co-pay models can improve planning and reduce financial shocks.
Commissioner questions and research requests: commissioners asked for subgroup analyses by age and utilization (children and older adults) and for a behavioral-health-specific breakdown; staff agreed to provide further disaggregation in the report. Commissioners also discussed the role of AI and actuarial tools to give individuals better ex ante estimates of expected annual costs under different plan options.
Why it matters: the commission framed rising cost sharing as both a symptom and an amplifier of underlying price growth in provider and pharmaceutical prices and said reforms that improve predictability and reduce primary-care cost sharing could mitigate hardship for families while broader price-growth solutions are pursued.
Next steps: staff will refine models and include policy recommendations in the final cost trends report; the commission will use the findings to inform forthcoming hearings on the benchmark and potential policy actions.
