Exactly. Also, it's worth noting that the "retail" price is a way that health care providers rip off the government by claiming a loss on their books after they are reimbursed by medicaid.
The grandparent's intuition that by being on a high deductible plan I would not be eligible for the "buying club" benefits of negotiated pricing doesn't pan out: The price is negotiated so that there is a captive "in-network" market which guarantees some level of utilization and helps with planning. Insurance companies want to offer a large population to care networks in order to negotiate a volume discount.
Also, if you consider a catastrophic plan that kicks in if something really bad happens and I use over $20K of care. Nearly any serious condition or accident would qualify. If it happened, I'd be able to switch to a lower deductible plan in the next open enrollment. Worst case, I'd end up paying my premium savings (and then some) toward that one event, but overall I would not be much worse off than if I'd just chosen the expensive plan to begin with.
When I had the high deductible plan through an employer I did the math on it compared to the most deluxe plan offered. Worst case, if I maxed out the individual and family deductibles on the high deductible plan, I'd end up paying about the same as the annual premiums of the deluxe plan. But if, as is likely, I didn't have a catastrophic incident, I'd save a lot of money (which I did).
> Also, it's worth noting that the "retail" price is a way that health care providers rip off the government by claiming a loss on their books after they are reimbursed by medicaid
You've got it backwards - Medicare (and Medicaid, to a lesser extent) are the ones who rip off providers, by reimbursing less than COGS[0]. The "retail" price is actually a way that providers make up for these losses by passing on the costs to private insurers (who then pay for those increased costs by accounting for them as claims, improving their MLR, and allowing them to raise premiums for it).
[0] Medicare's own financial statements attest to this; you don't have to take providers' words for it.
The grandparent's intuition that by being on a high deductible plan I would not be eligible for the "buying club" benefits of negotiated pricing doesn't pan out: The price is negotiated so that there is a captive "in-network" market which guarantees some level of utilization and helps with planning. Insurance companies want to offer a large population to care networks in order to negotiate a volume discount.
Also, if you consider a catastrophic plan that kicks in if something really bad happens and I use over $20K of care. Nearly any serious condition or accident would qualify. If it happened, I'd be able to switch to a lower deductible plan in the next open enrollment. Worst case, I'd end up paying my premium savings (and then some) toward that one event, but overall I would not be much worse off than if I'd just chosen the expensive plan to begin with.
When I had the high deductible plan through an employer I did the math on it compared to the most deluxe plan offered. Worst case, if I maxed out the individual and family deductibles on the high deductible plan, I'd end up paying about the same as the annual premiums of the deluxe plan. But if, as is likely, I didn't have a catastrophic incident, I'd save a lot of money (which I did).