Jonathan (JQ) Hill (3:35)

Okay. When it comes to price, how do these plans shake out?

Lisa Jarvis (3:41)

So you'll notice that the HMO is probably going to be cheaper than the ppo, and that's because you've got this limited network of providers. You're not allowed to go out of network. Right. And you have to kind of ask for permission to see specialists. The PPO is going to give you a lot more flexibility, and so it probably is going to be more expensive. And you'll feel that.

Jonathan (JQ) Hill (4:00)

Okay, so we got HMOs, we got PPOs. There's more jargon that shows up in open enrollment, and I'm hoping you can remind us what it means. The words I'm thinking of are premium, copay, and deductible.

Lisa Jarvis (4:14)

So there's a premium. That's what comes out of your paycheck. There's the deductible. That's how much money you need to pay before your health insurance kicks in for certain services. And then there's the copay. So every time you visit your doctor, it might be $25, it might be $40. That's how much money you pay, and your insurance pays the rest of it.

Jonathan (JQ) Hill (4:36)

So there's another plan that I've heard about, and that's the high deductible plan. What is that and how does that fit into these options?

Lisa Jarvis (4:44)

Yeah. So I think you want to think about how you're using health care. If you're someone who is not using a lot of healthcare, a high deductible plan might be good for you. What that means is you're paying very little and in premiums. So the premium is the part that comes out of your paycheck. Right. You see that number and it can feel really good to have it be a low number. But the trade off could be a high deductible, meaning that you first are going to be paying a lot of money up front before your health insurance starts to kick in and pay for your coverage. You can also pair that with some other things like a health savings account which can allow you to put some pre tax dollars aside to help pay for that deductible. So there's a, it's a, it's complicated but you want to think about how much you think you're going to be using your healthcare. And you know, sometimes a high deductible plan might be an affordable choice for you and make a lot of sense.

Jonathan (JQ) Hill (5:37)

Yeah, you talked about that health spending account. There's also a flexible spending account. What's the difference between those two?

Lisa Jarvis (5:43)

There are other ways that you can try to save some money on your healthcare expenditures for the year. There's an HSA which basically is a way of pre tax money out. You have to have a high deductible plan. That's the key to know in order to have an hsa. And then you can decide how much money you want to put aside. That money can roll over for year to year and it can also grow so it can be invested. If you don't spend it, you can use it the next year. An FSA is a little different, that's through your employer and there's a limit similarly to an HSA and you're putting money aside and you have to spend it all in that calendar year. So you gotta be careful about thinking about what you want to put aside. Usually there's either a little bit of wiggle room around like tipping over that spending into the next year or it could be that some employers could choose to let you carry a little of the money over a certain percentage of it for the full year. But you can use that for lots of things. The copay, the deductible, you can use it for what you buy at cvs. That's, you know, you'll look at the very end of your receipt at CVS and there'll be a line that says FFSA eligible or HSA. That, that can be deduct, you can get that money back.

Jonathan (JQ) Hill (6:54)

Yeah, I did discover that I could buy my fancy sunscreen with an fsa. That was exciting.

Lisa Jarvis (7:00)

I mean I nerdily save all my CVS receipts and at the end of the year when I realize I am running out of time to spend my FSA Money. I go through them all and I find all sorts of things I never would have expected are covered by an fsa.

Jonathan (JQ) Hill (7:18)

This whole process seems like it can be so confusing. Do you find it confusing? I mean you cover this.

Lisa Jarvis (7:25)

I find it very confusing. My mother in law was trying to pick a plan through the aca. I found it very hard to help her. Luckily the ACA has navigators so you can go to one of those people and they'll help you find your plan. When it comes to employer sponsored insurance, you just really have to think about all the different ways that you might be paying or not paid.

Jonathan (JQ) Hill (7:48)

Right?

Lisa Jarvis (7:48)

So you just have to think about how you're using your healthcare and how your insurance is covering what you might use. It's complicated. It can be a really, it's like trigonometry and algebra and geometry combined. I don't know, trying to calculate all the right factors and come up with the right choice. But I think ultimately trying to understand what your family can afford and what they use, you know, is also going to help you as you try to do the calculation of what makes the most sense for you. This year when you open that email and from your HR and look at what the premiums are, you open up the Obamacare to find out what your plan will cost next year, you might experience a little sticker shock. Healthcare costs are going up and employers are trying to balance absorbing some of those costs or managing some of them with passing them on because they can't afford it all either. And so look at the fine print. It might be that your premium doesn't change, but it might be that there's more costs on the back end that you should be aware of. So I just think really paying extra close attention, this is the year to not just accept the plan plan that you've had every year and just weigh your options carefully.

Jonathan (JQ) Hill (9:05)

You heard right. Premiums are about to go up. A lot. Coming up, we'll explain why support for.

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Jonathan (JQ) Hill (11:02)

This is Explain it to Me. I'm JQ and today we're explaining all things health insurance, including why it's so expensive this year. No matter where you get your insurance, whether it's through your job, the Affordable Care Act, Marketplace, or Medicare, the price is going up. To find out why, I went to DC's number one go to for healthcare.

Julie Rovner (11:23)

Reporting, I am Julie Rovner. I'm chief Washington correspondent for KFF Health News, and I'm host of what the Health brought to you by KFF Health News and WAMU 88.5 FM.

Jonathan (JQ) Hill (11:34)

Julie has covered the health care system for nearly 40 years, and she says that while the costs always go up, this time is different.

Julie Rovner (11:43)

Well, we are talking premiums going up pretty much across the board for every kind of health insurance right now. You know, we've had bigger inflationary spikes, particularly in the early 2000s. But for the last 15 years or so, health care costs have been rising, but not terribly fast. They seem to be accelerating again now.

Jonathan (JQ) Hill (12:03)

Why now?

Julie Rovner (12:04)

Well, there's a bunch of reasons, but they come down to sort of two things. Price and utilization. Utilization is how many healthcare services people use, and obviously the more services people use, the more the nation's healthcare bill goes up. So there's a lot of things that are driving expanded use right now. One of them is the aging of the baby boomers. I am one of them. As we get older, we suddenly get and need more health care. And to some extent we're still catching up from health care that people didn't get during the pandemic when nobody was leaving their houses and when you basically didn't go to the doctor unless you absolutely had to. So we're still seeing people not only getting care that they didn't get then, but people who didn't get and should have, who are sicker than they might have been if they'd gotten preventive care or care early in the pandemic. So that's sort of driving up use. And then of course there's just new things that we can do. Everybody Knows about the GLP1 Weight loss drugs that are so popular and so highly used right now. We have lots more new drugs. I mean some of these are sort of amazing advances. It used to be you didn't want to do things and you know, it was always cost benefit, whether the benefit was worth the cost. And the cost was not just monetary. The cost was in how long you would be laid up if you had a joint replaced or had some kind of surgery. Now we have much easier surgeries, so it makes it much easier to do these things. So we're doing more of them. So that's just the usage side. Then there's the price side and the price side. Basically, you know, I can sum up in one sentence. We have the highest prices in the world because people who provide health care here can. The government doesn't regulate it nearly as much as they do in other countries. Most other countries have, do have hybrid systems. They do use some private insurance and some government subsidies. But they also, most of them that don't have spending out of control have much more serious regulation of prices than the United States has.

Jonathan (JQ) Hill (14:12)

It's really wild because we should be going to the doctor, we should be taking care of ourselves. But it feels like when it comes to the price of things and the price of insurance, we kind of get punished for it.

Julie Rovner (14:22)

Yeah, we do. And you know, one thing that I didn't mention is that because we now spend so much on health care that it's like 18% of our GDP. Lots of people who would like to earn money are going into healthcare. So we have people sort of encouraging possibly unneeded healthcare to make a profit. So there's that piece of it also. In addition to the things that we should do and that end up costing.

Jonathan (JQ) Hill (14:49)

Us money, is there a difference in the rise in costs we're seeing for those of us who get employer sponsored insurance versus those of us who get our insurance through the ACA marketplace?

Julie Rovner (15:01)

There is. And one of the reasons that in 2026 ACA premiums are rising is because of these additional subsidies that made it easier for people to get health insurance under the aca. The expanded tax credits that basically doubled enrollment. And insurers seeing that those extra premiums were scheduled to end, said, well, a lot of people are going to no longer be able to afford their health insurance. So we're going to have to raise premiums on the theory that the sick people are going to hang on to their health insurance and the healthier people are probably going to drop it if they see the prices go up. Although everyone will be affected if people can no longer afford their coverage and go uninsured. Because like with the pandemic, they won't get medical care until they absolutely have to. And then it's more expensive and then the cost of that going to have to get passed along to somebody.

Jonathan (JQ) Hill (15:54)

Are employers absorbing some of these higher costs for people who get that employer sponsored insurance?

Julie Rovner (16:01)

It depends. You know, during times when it's hard to hire people and we have tight labor markets, employers try to absorb as much of the increases in health care spending as they can because they don't want to load more onto their workers and therefore make it harder to win new workers and retain old workers. Right now, the labor market is not as strong as it has been and health care costs are going up. So it's expected that a lot of employers are going to pass along a lot more costs to their workers.

Jonathan (JQ) Hill (16:29)

What can consumers do to try to mitigate these costs? Like, you know, it's getting expensive. What can we do?

Julie Rovner (16:37)

It's really hard. You know, there are a number of people who think that price transparency is a big help. It's probably not the answer to everything, but knowing what things cost in advance certainly doesn't hurt. Being able to shop around for elective things also doesn't hurt sometimes, you know, if you go to a hospital, you can find the same care as an outpatient for much less because of the complicated ways that government and private insurers pay for these things. Sometimes you can offer to pay cash instead of use your insurance and you can save money. That's very true for things like generic drugs. So there are ways to save some money. But we're all sort of captives of the mess of a health care system that we have right now.

Jonathan (JQ) Hill (17:19)

Okay, so everyone is focused on premiums right now because they're going up. But that's just one symptom of what is going on with our health care system. Right. Like there's a bigger problem here.

Julie Rovner (17:30)

There definitely is. And the health. And obviously Republicans are saying, you know, we're over subsidizing for the aca, which is a mess.

Dylan Scott (17:37)

Obamacare is terrible.

Lisa Jarvis (17:39)

It's bad health care at far too high a price and it's become a boondoggle. It's a subsidy for insurance companies. When you subsidize the health care system.

Dylan Scott (17:48)

And you pay insurance companies more, the prices increase.

Lisa Jarvis (17:52)

That's been the problem.

Julie Rovner (17:53)

Well, we subsidize everybody else who gets health insurance. You know, the federal government subsidizes Medicare. Federal and state governments subsidize Medicaid. There's a gigantic tax break for people who have employer provided coverage that most people aren't even aware of. So it's really only been people who buy their own coverage in the individual market and small businesses who haven't been getting a subsidy. And that's what this is.

Jonathan (JQ) Hill (18:19)

If insurance just keeps getting more and more expensive, do you think we'll see more people just kind of opt out of it altogether?

Julie Rovner (18:28)

Well, that's a concern. And of course that's where we were before the Affordable Care act passed when we had, you know, 14% of the population that didn't have insurance. Now it's down to an all time low of about 8%. But you know, we're definitely going to see people lose their insurance even if they're not dropping it voluntarily. The bill that Republicans passed this summer takes away eligibility for a lot of people and out of pocket costs, as you say, are going up dramatically even if you do have insurance deductibles and co payments. And just the cost of medical care in general means that even people with pretty good insurance end up owing lots of money out of pocket. So I think we're sort of coming to another transition point where this is going to be back on the national agenda.

Jonathan (JQ) Hill (19:19)

Up next, we talk about some creative solutions to our healthcare problems and why finding a fix won't be easy.

Julie Rovner (19:33)

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Dylan Scott (19:56)

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Jonathan (JQ) Hill (20:30)

It's JQ back with Explain it to Me. And it's safe to say most people agree that the American health care system is broken and that it's probably not getting fixed anytime soon. So what are we supposed to do in the meantime? That's the question I asked my colleague Dylan Scott. He's a senior correspondent at Vox and he covers health and the healthcare system.

Dylan Scott (20:52)

You know, for some people it's like oh my God, like I broke my leg or I got diagnosed with cancer. And you know, you see people going to GoFundMe or Kickstarter just literally basically begging people like, please help me with my medical costs.

Jonathan (JQ) Hill (21:06)

I just created a GoFundMe page and.

Lisa Jarvis (21:08)

I'm trying to raise money to help me pay for my healthcare expenses. Obviously we expected some out of pocket costs, but not this. I'm looking for help.

Dylan Scott (21:17)

Unfortunately, like that's one predicament that the US healthcare system puts people into if they have like a serious medical need is you might just have to like beg strangers to chip in to cover your bills. But short of that, you also have Americans, they're like looking for basically insurance, like products, you know, something where it's like you pay a monthly payment and if you have medical bills, hopefully it's going to cover you. And there's a few different variations on that. There is something called short term limited duration insurance which like ideally is supposed to be like a three month plan that you get on when you're between jobs or something like that. But some people are trying to go on those on a more permanent basis. There are things called association health plans which are supposed to be like groups of businesses who pool their resources together to try to cover their workers health care costs. And then you know what I think is one of the most interesting ones is something called healthcare cost sharing ministry.

Jonathan (JQ) Hill (22:15)

What is a healthcare cost sharing ministry?

Dylan Scott (22:18)

So like in their original form, basically what this is is like a group of people, you know, maybe literally a group of people who go to the same church together who are like, okay, we're going to pool our money together. We might ask people who participate to adhere to certain moral ethical standards that you know, reflect our Christian values. And then like, you know, it's in theory supposed to work like insurance where it's like you pay into this pot and if you have a medical claim or some kind of medical issue comes up, you receive healthcare services, you can take those bills back to the group and they'll give you money out of the pot to cover the costs. Technically, these kinds of arrangements have been around for decades. Like, the first one started back in the early 1980s, but for a long time, I mean, they were really niche. But then the Affordable Care act passed and was this big flashpoint politically, as people well know, especially for, like, deeply conservative and religiously devout people. They had a lot of objections to the aca. Some of them had objections to, like, the provisions that required insurers to cover birth control, things like that. And so they were like, you know what? I want to, like, opt out of this law. And actually, the law, in the way that it was written, kind of gave them an out. It said that if you sign up for a healthcare cost sharing ministry, if you're enrolled in something like that, then you can be exempted from the individual mandate. And so I think all of those things combine together to start driving a lot more people to these healthcare cost sharing ministries.

Jonathan (JQ) Hill (23:59)

It sounds a lot almost like mutual aid.

Dylan Scott (24:02)

Yeah, I think that's the crux of it, I think, in a lot of ways. But increasingly, these are, like, sophisticated businesses with really well funded advertising campaigns.

Lisa Jarvis (24:12)

Finding affordable health care can be stressful. And some people think that insurance is their only option, which is why CHM.

Jonathan (JQ) Hill (24:19)

Was the first to establish a cost sharing ministry.

Lisa Jarvis (24:22)

It's a collection of specialized care components.

Jonathan (JQ) Hill (24:25)

Resources that help you through life's most challenging medical moments.

Dylan Scott (24:29)

You know, they've increasingly de emphasized the religious aspect of it. You see them adopting names like Liberty, Health Share, and things like that. Even with, like, the moral and ethical standards that they want people to sign on to, they've kind of more and more de emphasized, like, you have to believe in God and that Jesus Christ is our Lord and Savior. And it's more like, you know, you're going to be an upright person. You're going to, you know, be moral, but in a sort of vaguer, more secular way. And I think that's because these companies see a business opportunity.

Jonathan (JQ) Hill (25:02)

How many people use these kinds of ministries?

Dylan Scott (25:05)

Back in the day? In the mid-2000s, there were, like, 200,000 people enrolled in these plans. As of about 2018, there were a million people enrolled in a class share. So, yeah, like, a pretty significant increase from the decade before and then past that as the most recent estimate that we have. And it's worth emphasizing, like, because these things are poorly regulated, it's hard to get really reliable data about them because these can kind of just operate without the government even really knowing about it. But the Colorado Department of Insurance tried again to estimate how many people have joined these ministries in 2023 and came up with 1.7 million Americans were now enrolled in a healthcare cost sharing ministry. So like that's pretty exponential growth if you go back to just like 20.

Jonathan (JQ) Hill (25:53)

Years ago and how has it worked out for people who are in these ministries.

Dylan Scott (25:58)

So I think it's really important for people to understand these ministries are not subject to the same rules about pre existing conditions, about not putting annual limits on people's benefits. They all of the insurance regulations that people have gotten accustomed to after the ACA became law do not apply to these healthcare cost sharing ministries. So you're basically just relying on sort of the goodwill of these ministries to pay out and the just like hoping that they have enough money to cover whatever your medical bills may be. The way that insurance works is it needs scale. You need a lot of people paying into the pot, frankly. You need a lot of people who are healthy, who don't have serious medical needs, who are just paying their premiums in and not taking anything out. And that's hard to do sometimes as we see with rising costs across the whole system with like hundreds of thousands or millions of people enrolled in your health insurance plan. And so you can imagine with some of these smaller healthcare cost sharing ministries which like, you know, individual ones may have maybe hundreds or just like a few thousand people enrolled, there might not be enough money in that cost sharing ministry to cover the cost. And so then you're kind of just shit out of luck.

Jonathan (JQ) Hill (27:16)

Yeah. Is scaling up the solution for these ministries is like, is that, would that solve that problem?

Dylan Scott (27:26)

The way to solve what's going wrong with our healthcare system is not to scale up these healthcare cost sharing ministries that can then discriminate against people with pre existing conditions. I think instead what we need to do is like we need to be looking at the whole system's cost, figuring out how to bring those down, which is hard and which is going to take some difficult work. But I do not think these plans themselves are the solution.

Jonathan (JQ) Hill (27:49)

What is the solution?

Dylan Scott (27:52)

It's the worst time of year because it's, yeah, it's like, hey, sign up for health insurance and yeah, your premium's probably higher than it was last year and you know, the deductible might be going up too. And it's like, I think in the long term we need like policymakers and the industry and the payers to come together and figure out out how to make just the overall costs of healthcare lower so that we can provide people with comprehensive coverage more affordably. But in the meantime, yeah, we live in America. We're individualists, we're consumers. You kind of got to look out for yourself and just be really careful about how you're kind of making those calculations because it really depends on your individual situation.

Jonathan (JQ) Hill (28:41)

If you want to know more about health insurance and how to navigate open enrollment, head over to vox.com we have an entire guide on how to use your benefits and we even get into the history of why this all works the way it does. Soon on Explain It To Me, we'll be talking turkey. Thanksgiving is around the corner and we want to know what you think of this dinner. Mainstay. Do you love to turkey?

Lisa Jarvis (29:04)

Hate it.

Jonathan (JQ) Hill (29:05)

Have a go to way to prepare it. A favorite alternative? Give us a call at 1-800-618-8545 or email us at askvox vox.com if you love listening to Explain It To Me. There's a way to love it even more by listening to it ad free. You can do that by becoming a Vox member. You'll also get to listen to other great shows like Unexplainable and the Gray Area with no ads too. And you also get a ton of other perks or having a sale right now where you can get $20 off. Learn more and get the deal by going to Vox.com members today. This episode was produced by Avishai Artsy and Danielle Hewitt. It was edited by Ginny Lawton and our executive producers Miranda Kennedy. Fact checking by Melissa Hirsch and Adrian Lilly and Patrick Boyd did the engineering. I'm your host, Jonathan Hill. Thank you so much for listening. Talk to you soon. Bye.

Lisa Jarvis (30:10)

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