Self-Funded With Spencer High Healthcare Deductibles Are A Failed Experiment
Sep 30, 2025
Trey Smith, an accomplished employee benefits sales leader at Hub International, reveals the pitfalls of high healthcare deductibles, arguing they create major barriers to necessary care. He advocates for 'first dollar' coverage, which encourages timely treatment and ultimately lowers costs. The conversation explores innovative plan designs, the importance of tiered networks for directing patients to quality providers, and the role of tech in enhancing benefits. Trey emphasizes how these strategies not only help employees but can also boost recruitment and retention for employers.
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High Deductibles Block Access
- High deductibles create a massive barrier to care for middle-income employees and functionally leave them uninsured until they hit the deductible.
- Trey Smith argues this deters preventive care and drives downstream higher-cost, catastrophic claims.
Offer First-Dollar Coverage Strategically
- Remove or waive first-dollar cost for care when members use high-quality providers to increase early access and preventive utilization.
- Expect utilization to spike initially and claim spend to fall after 12–18 months as conditions are caught earlier.
Consumerism Failed Because Costs Were Too High
- Consumer-driven healthcare failed because extreme cost-sharing blocked access rather than creating savvy shoppers.
- Trey Smith says removing cost barriers can produce the intended consumerism when paired with guardrails.