The size of deductibles for health insurance plans has increased dramatically. According to researchers, between 2002 and 2022, deductibles for single-person plans grew by 380% and for family plans by 332%. This represents an average annual increase of 8.7% for single-person plans and 7.8% for family plans.
While consumers may not notice an immediate difference, California’s plan is designed to slow the growth of health spending rather than reduce it. Over time, this could have a significant impact. Health economist Glenn Melnick explained that slower growth in premiums could result in lower contributions from individuals.
However, not everyone is in support of this plan. Representatives for hospitals and doctors are critical of the proposed spending cap, arguing that focusing solely on household income could lead to reduced access and poorer quality of care for patients. They believe the cap does not take into account factors such as inflation, rising pharmaceutical costs, and the natural increases in spending driven by the state’s aging population.
In a letter to the board, Ben Johnson, vice president of policy at the California Hospital Association, expressed concerns that the proposed cap would force healthcare providers to cut back on care or face penalties. He emphasized the importance of considering the various factors that drive healthcare spending.