Zero deductibles and $5 copays?

Employers are slashing deductibles and copays so more workers will go to primary care doctors — and avoid unnecessary trips to the emergency room………………..

Zero deductibles and $5 copays? How American Airlines and Plano are cutting out-of-pocket health costs

Fort Worth offers free virtual visits, too, and penalties for going to the ER without a true emergency.

Employers are slashing deductibles and copays so more workers will go to primary care doctors — and avoid unnecessary trips to the emergency room.

By Mitchell Schnurman

7:00 PM on Mar 2, 2020 — Updated at 6:01 AM on Mar 3, 2020

Lots of people worry about paying for health care, and that’s understandable, given the steady rise in insurance premiums, deductibles and copays.

Such pocketbook issues discourage many from getting treatment, even when dealing with chronic conditions. But avoiding care isn’t a smart way to curb health spending, not over the long run, and some employers are pushing back by lowering out-of-pocket costs.

They’re cutting deductibles and copays and offering incentives to use selected primary care physicians. One is increasing penalties for unnecessary trips to the emergency room.

Plano’s health plan lets city employees visit certain doctors for just $5 — whether they’re meeting in the doctor’s office, on the phone or at a retail clinic.

“We found that even a $25 copay can be a barrier to receiving care,” said Andrea Cockrell, Plano’s administrative services manager.

Almost 1 in 3 people are worried about paying the costs of premiums and deductibles, according to a recent survey of likely voters by NBC News and the Commonwealth Fund. The concern is higher among those earning less than $50,000 a year.

Many also went to lengths to pay unaffordable medical bills over the past two years. Nearly half said they dipped into savings or retirement funds and borrowed from family and friends. About one-third racked up credit card debt for medical expenses.

For Plano employees, the $5 copay covers doctors and other providers with Village Health Partners, Catalyst Health Network and CVS MinuteClinic. Virtual visits are also $5.

For many years, Plano pushed its workers to embrace primary care. In addition to a low copay, the city offers discounts on insurance premiums for employees and spouses who get annual physicals.

The idea is to catch problems early, treat chronic conditions proactively and encourage workers to develop a relationship with a primary care doctor.

Village Health has extended hours on weeknights and weekends, which helps reduce trips to the ER. Plano just extended $5 copays to a larger area and more doctors by aligning with Catalyst providers. Some Plano firefighters travel from as far away as Oklahoma, Cockrell said, and Catalyst’s network extends far.

These efforts are key to building an affordable, sustainable health plan. Plano is self-insured, and in 2018, it spent almost $32 million on health claims for 5,300 employees and dependents.

In its 2020 benefits guide, the city touted the importance of preventive care and having a primary care doctor. The strategy appears to be working.

“We are very proud of the fact that we have only passed along one premium increase in the past nine years,” Plano City Manager Mark Israelson wrote in a letter to employees.

In January, American Airlines adopted a health plan tailored to workers in Dallas-Fort Worth, home of its headquarters and largest hub. The new plan has no deductibles, a significant savings for many, as well as lower monthly premiums.

In American’s most popular traditional plan, annual deductibles are $850 for individuals and $2,550 for families.

DFW ConnectedCare also has low, predictable copays. An office visit to a primary care doctor is $15, half the out-of-pocket price for an in-network visit in the standard plan. A trip to a specialist is a flat $50; on the standard plan, it’s 20% of charges after meeting the deductible.

“Our team members understand that health care is expensive in D-FW,” said Adrienne Schneider, American’s director of benefits. “Like a lot of us, they’re really risk-averse when it comes to health care. We wanted to put together a plan design that would give them what they value.”

There is a catch: Care is delivered only through the Baylor Scott & White Quality Alliance, the accountable care organization affiliated with Baylor Scott & White Health. American employees also can access care from partners with Methodist Health, Cook Children’s and Children’s Health in Dallas, but the plan generally doesn’t cover doctors outside the alliance.

“Your primary care physician acts as a quarterback for your care,” American wrote in a benefits guide for new employees. “But they’re not a gatekeeper.”

In the 1990s, HMOs often used primary care doctors as gatekeepers, requiring referrals to see specialists. Many patients recoiled at the restrictions, and health plans today usually encourage starting with a family doctor but don’t require it.

American has about 26,000 local employees. In the first year of DFW ConnectedCare, about 2,200 local workers signed up, along with a like number of dependents, Schneider said. That was fewer than expected.

“They felt so wed to their doctors” that any restrictions were a deterrent, Schneider said. “It was an aha moment for us.”

In Fort Worth, officials are using a carrot and a stick to help lower health costs. Employees have no copays if they use virtual visits or certain clinics that offer primary care.

But they could face much higher costs for an ER visit. If the problem is not considered an emergency, employees must pay half the charges, said Brian Dickerson, the city’s human resources director.

The plan design has affected behavior in meaningful ways: In two years, the rate of virtual visits soared and the share of ER trips declined by a quarter.

Not coincidentally, Fort Worth’s medical claims fell 18% from December 2017 to August 2019, Dickerson said. And the city’s health plan ended fiscal 2019 with a budget surplus of over $8 million.

“There is a lot of motivation to think before you go to the emergency room,” Dickerson wrote in an email.