The way people buy and receive healthcare is undergoing a revolution. From the increased utilization of technology to new health reimbursement arrangements (HRAs), 2019 saw changes for providers, employers and employees that should improve the healthcare and health insurance landscape for 2020.
Improvement #1: New HRAs go into effect
In 2020, a new rule that was issued earlier this year by the federal government goes into effect, creating a new class of HRAs. This new class, the Individual Coverage HRA (ICHRA) allows employers to give their employees money to purchase an individual or family health insurance plan in the marketplace. The employers get to choose how much money they give the employee and the employee gets to choose the best plan for them.
That means employers aren’t stuck purchasing an expensive, all-encompassing group plan to try to meet everyone’s needs, and employees aren’t stuck with a group plan that doesn’t work for them, just because that’s the only affordable health insurance option they have. Employers also have the option of offering one class of employees (e.g. full-time) a group plan and another class (e.g. hourly or part-time) an HRA. This means classes of employees to whom employers wouldn’t otherwise offer health insurance could get help purchasing a plan.
Improvement #2: Increased utilization of technology
More and more providers are using technology to see patients virtually. This means lower wait times, less commuting (which equals more productivity for everyone) and lower cost. This especially benefits people living in rural areas and people whose health plans require a copay for office visits. We expect this to become more prevalent in 2020.
Another thing to look for is the utilization of our daily data to manage chronic conditions. The quantification of our everyday lives via wearables—from steps to sleep—has become ubiquitous and the data we’re collecting is becoming more and more accurate. As the data improves, look for providers to use this habit as a way to manage current health problems and catch new ones early. Wearables won’t just be a convenience for providers and a hobby for patients, they’ll be an integral part of the treatment. This would mean fewer doctor visits and hopefully, healthier people.
Improvement #3: Patients see themselves as consumers of healthcare
As patients recognize themselves as consumers of the products of healthcare and health insurance, they become more willing to shop around. They research their options and become more effective advocates for themselves within the system. Then they tell others about their experience. This is already happening and what we expect, is for providers to use this information to improve treatment options.
Improvement #4: Local and state governments are offering alternative healthcare solutions
While the fight about the government’s role in health insurance and care rages at the national level, local and state governments are attempting to get more people the treatment they need. The state of Washington is considering a bill that would require employers who hire contractors to make contributions to nonprofit benefit providers for said contractors. On a more local level, cities like San Francisco are offering affordable healthcare through city-sponsored clinics and city-supported HSAs to which employers are required to contribute for each contract or hourly employee they have.
As medical costs continue to rise and the possibility of a national solution appears less likely, we predict more local and state governments will look for solutions to get their populations affordable healthcare in 2020.
Some not-so-great things happening in 2020
The IRS tracks HSA contribution limits, HDHP deductibles and maximum out-of-pocket expenses to inflation, so as inflation rises, so too do these numbers. As such, the HSA contribution limits for individual and family plans in 2020 will increase by $50 and $100, respectively, to $3,550 and $7,100. This would be good news, but the annual increases in the cost of medical care outpace inflation, so it remains important to save more in your HSA than you spend.
In 2020, the ceiling for HDHP annual out-of-pocket maximums will increase to $6,900 for individual plans and $13,800 for families. The minimum deductible for an HDHP will increase $50 for individual health plans to $1,350 and $100 for family plans to $2,700.
Yes, healthcare gets more expensive every year. But governments, providers and employers are utilizing technology and policy to come up with creative ways to get people the healthcare they need. We expect that to continue in 2020 and improve the options and care available to everyone.
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