PROVIDENCE, Rhode Island (Reuters) - Older people who have higher co-payments for doctor visits are more likely to end up in the hospital, making their treatment more costly in the long run, according to the first large U.S. study of the issue.
The research, published in the New England Journal of Medicine, questions the wisdom of raising co-payments to save money, at least among the elderly.
That might be a way to cut health care costs among younger people, but not for people age 65 and older, Dr. Amal Trivedi of Brown University, who led the study, said in a telephone interview.
“It’s a lose-lose proposition for most health plans,” Trivedi said.
Older people “have more medical conditions, they spend more on health care, and they usually are on fixed incomes, so they’re much more sensitive to the co-payments. And our study suggests that raising co-payments for the elderly would be counterproductive,” he said.
Co-payments are the portion of healthcare paid for by the patient and are a way of sharing expenses between patients and insurers.
Trivedi’s team studied nearly 900,000 people enrolled in 36 different plans under Medicare, the federal health insurance plan for the elderly and disabled. Half of the plans raised co-payments during the study period from 2001 through 2006.
Enrollees in plans whose co-pays for a trip to a specialist nearly doubled to $22 had a hospitalization rate that was 8.7 percent higher than among people whose copayments remained unchanged, averaging $11.38.
“We estimate that the average health plan, for every 100 enrollees, would gain $7,150 from collecting more co-payments and from decreased use of outpatient services, but that same plan would spend approximately $24,000 in additional hospital expenses because care in the hospital is so expensive,” said Trivedi.
“Perhaps plans should seriously consider reducing co-payments,” he said.
Requiring co-payments turned out to be especially costly to insurance companies when their subscribers were poor, poorly educated, black or had underlying health problems like diabetes, high blood pressure and a history of heart attack.
Those are the people whose decision to seek treatment was the most sensitive to the increased co-pays, said Trivedi.
Between 2001 and 2006, the typical co-payment for an office visit doubled under employer-based health plans.
Editing by Maggie Fox; Editing by Cynthia Osterman