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March 11, 2024

Episode-Based Cost Sharing to Prospectively Guarantee Patients’ Out-of-Pocket Costs

Author Affiliations
  • 1Department of Radiology and Imaging Sciences, Emory University School of Medicine, Atlanta, Georgia
  • 2Department of Health Policy and Management, Rollins School of Public Health, Emory University, Atlanta, Georgia
  • 3Department of Population Health Sciences, Duke University, Durham, North Carolina
  • 4Department of Internal Medicine, University of Michigan Medical School, Ann Arbor
  • 5Department of Health Management and Policy, University of Michigan School of Public Health, Ann Arbor
JAMA Intern Med. 2024;184(6):597-598. doi:10.1001/jamainternmed.2023.8566

In most clinical circumstances, health care consumers in the US cannot determine their out-of-pocket expenses until after their care is delivered. Cost uncertainty and concerns about paying for care lead to many negative consequences, including forgoing high-value services and incurring medical debt.1 Difficulty predicting and affording health care is an increasing and pervasive problem and is no longer limited to those with strained financial resources.2,3 Most important, the clinical and economic impact of unpredictable out-of-pocket costs disproportionately affects individuals with low incomes, thereby exacerbating health inequities.4

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4 Comments for this article
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Insuring the insurer!!
Robert Belisle, DO | Retired primary care
The health insurance industry is already extracting billions of dollars in profits from the health care market and now you propose that we "require all patients to equally share the financial risk associated with unpredictable deviations in treatment intensity" thus insulating the insurer even more. We need to walk away from our non-functioning insurance model.
CONFLICT OF INTEREST: None Reported
Re: Insuring the insurer!!
Michal Horný, PhD, MSc | Emory University
Hi, Dr. Belisle, I am the author of this article. I am sorry it wasn't clear, but we argue for the opposite of insulating the insurer. Under episode-based cost-sharing, patients would bear less risk than under the status quo (patients would receive a guaranteed out-of-pocket cost amount before receiving care, which is in sharp contrast to the cost uncertainty that they currently face when seeking care). This risk would be shifted to the insurer, and therefore, the insurer would bear more risk than they do now. I am happy to answer any questions or address any other concerns that you may have.
CONFLICT OF INTEREST: None Reported
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Why do we have copays and deductibles at all?
Johnathon Ross, MD MPH | University of Toledo
There is no evidence that Americans use more care than those in other rich nations or that co-payments make patients or doctors make wiser clinical decisions.if co-payments and deductibles were drugs in a controlled trial to cure inappropriate care or to control costs the experiment would be stopped as a clear failure. Rand Corpoation looked at co-pays and found that they reduce needed care as much as unnecessary care. Since the super majority of care seeking is appropriate, that means that they prevent more necessary care than un-necessary care.
The CBO scored an improved and expanded Medicare for all
in December of 2020. They say we can cover everyone with comprehensive benefits, allow complete choice of provider, keep caregivers and research whole, and we will still save at least $40 B annually (probably more). The disease of the American healthcare system is its financial complexity. We need a universal, simple affordable system like improved Medicare for all instead of the sickness care non-system we currently have. We must reform healthcare before the venture capitalists buy it up and make us pay to get it back.
CONFLICT OF INTEREST: Past President of Physicians for a National Health Program
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Several dragons to slay
David Hartman, BSEE | Retired
You will be fighting against the hospital 'systems', the professional 'associations' and LLCs, 'big pharma,' (mis)managed care organizations, nursing homes, rehabilitation centers, respite care facilities, 'big advertising', and probably a lair of other dragons that I haven't thought of.

There's an awful lot of money being charged for relatively inexpensive health care.

For example, I have OSA, and my DME supplier charges Medicare about $500 for a CPAP mask that I could buy myself for about $125.
CONFLICT OF INTEREST: None Reported
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