The game is three card monte. Maybe you saw it on a street corner (or more likely on the big screen). It just looks. A dealer crouches over three playing cards – two jacks and a queen – each one face down. He shows you the cards, shuffles them and asks you to “find the lady”.

You are confident that you cannot lose. The dealer knows you will never win. That’s because this is a “quick scam,” a quick scam that is guaranteed to leave you speechless and empty-handed.

As people have gotten better at spotting (and staying away from) illegal scammers like this one, the three-card monte has almost disappeared from the streets of the city. However, there is a similar hustle and bustle across the country, attracting more than half of all US workers – and it’s completely legal.

The game is called health insurance with a high deductible. Just like with the three card monte, what you think you see is not what actually happens. To understand how it works, you need to know the players involved: the dealer, the shill, and the mark.

The dealer: health insurance companies

Health insurance has one important rule in common with the three-card monte: the dealer always wins. Even in 2020, when every other sector of the U.S. economy struggled amid a raging pandemic, the country’s leading health insurance companies – the UnitedHealth Group, Anthem, and Humana – doubled their profits.

These companies are used to winning. But believe it or not, money wasn’t always the end game in health insurance. In fact, the original goal was to ensure that hospitals did not go bankrupt (while also saving patients from the financial devastation of a major medical crisis).

Until the 1990s, insurers were spending a whopping $ 0.95 of every dollar on medical care and only taking just under 5% of enrollment premiums to cover their overheads, leaving just enough for a small profit .

But as medicine became more sophisticated and lucrative, insurers shifted the focus from protecting patients to maximizing profits. It wasn’t long before health insurance was a huge company, with executives making tens of millions of dollars for strong financial results.

However, by the 2000s, everyone got into health money creation. Doctors and hospitals began to raise prices so aggressively that health care costs far exceeded headline inflation, rising nearly 6% annually.

Insurers, fearful that American companies could no longer afford the high annual premium increases, had to find new ways to make big profits. One approach would have been to force doctors, hospitals, and drug companies to work more efficiently in order to reduce health care costs, but insurers knew it would be an extremely difficult task.

Instead, they came up with an ingenious trick of their own: High Deductible Health Insurance (HDHPs). Instead of asking companies to pay the higher premiums, insurers helped employers shift much of the financial burden onto unsuspecting workers. The hustle and bustle worked perfectly.

In 2007, HDHPs made up only 5% of all employer-based plans. By 2013 the number had risen to 20%. Today 51% of all US employees are enrolled in an HDHP. As a result, Americans are paying more out of pocket today than ever before – up to $ 6,650 for an individual or $ 13,300 for a family.

The Shill: US Employers

In the three-card monte, the dealer’s impressive dexterity is only part of the cheating. The other essential part is making the game look winnable. This is where the shill comes in. Shills are the people who gather around the dealer. Your job is to get the audience excited about the game (without making it obvious that they are part of the con).

Just as merchants in the three-card Monte Shills need, insurers need employers to make the HDHP hype work. After all, US employers provide coverage for more than 150 million Americans, making it the largest customer base in any health insurance industry of $ 1.32 trillion.

Instead of risking the loss of a business customer through rising premiums, the insurer offers an ideal solution: “I will only increase your premiums by 3% this year if you agree to increase the deductible by US $ 500.” And the best part about it : “Your employees are motivated to reduce health costs because they now have more skin in the game.”

Like the shills in the three-card Monte Shill, the employer is helping to spark enthusiasm for this new plan. The performance manager or HR leader points out that if they make smarter healthcare decisions, people can end up paying far less than they did in the past. It sounds too good to be true. And it is.

Most Americans assume that they will stay healthy and hopefully save money. Insurers know that, statistically, the average American has paid enough personal services to hit their maximum deductible by May 19.

Whether patients are avoiding or in need of medical care, HDHPs give insurers the revenue they need to hold their profits. Employers are also doing well by avoiding a substantial portion of the premium. And all other players in the health system – from doctors to drug manufacturers – can charge ever higher prices year after year.

Just like in the three-card monte, everyone but the token wins.

The sign: American workers

In 2020, a study found that the average annual deductible for single people was $ 4,364, while families paid $ 8,439. Health insurers continue to defend these outrageous expenses by insisting that employees be more prudent with their health care expenses. But behind closed doors, they know full well that patients have minimal control over the cost of medical services.

The US health care system is nowhere near enough to allow patients to compare prices, purchase services cheaply, or significantly reduce the overall cost of their treatment. Hence, it’s absurd to think that Bob is driving around town from accounting to pick up bargains in order to find the best deal on his emergency appendectomy. It is equally ridiculous to think that Peggy could negotiate the price of her new, vital drug with the pharmacy or drug company from the sale.

Research shows that patients do not make better healthcare decisions as expenses increase. You just go without it. High deductible health insurance has been shown to delay the diagnosis and treatment of breast cancer. Similarly, a Harvard study of Medicare patients shows that increasing the cost of a prescription by $ 10 results in a 23% decrease in people taking their medication and a 33% increase in deaths.

Since the introduction of HDHPs, employees have a lot more “skin in the game” and a lot less money on their savings. It is not your fault. This is how the game is played. Everyone knows it’s rigged except the workers.