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Consumer-driven health plans are working

Kim Morris | March 12, 2009

Aetna released results of a 6 year study that shows that employers who adapted Health Savings Account (HRA) and Health Savings Account (HSA) plans have achieved substantial savings while employees are still getting the medical care they need. Aetna says "members are seeking increased levels of chronic and preventive care, using generic drugs more often and accessing online tools and information at higher rates than PPO members, while experiencing lower annualized medical cost increases". Emergency room usage was lower for participants in consumer-driven plans, suggesting that these employees make better decisions about the use of primary care vs. emergency room facilities.

The results of this study contradict the popular notion that HSA and HRA plans reduce the level of medical care actually provided to covered individuals.

An interesting part of the report shows that employers who made a full replacement of a traditional plan to a HRA or HSA achieve three times greater savings than those companies that offered these as options to employees. Presumably the difference is attributable to counterbalancing the effects of adverse selection. When offered a choice, healthy employees are more likely to switch to a lower cost/high deductible consumer-driven health plan while the unhealthy employees are more likely to stay with a traditional higher cost/lower deductible type plan. Conversely, from the employees viewpoint, those who were forced to switch to the HSA or HRA against their wishes are more likely to be less satisfied and to have incurred higher out-of-pocket health care costs. To that extent this occurs then some of the reported savings are simply a transfer of costs from employer to employee.

MedSave.com continues to maintains that consumer-driven health plans should be offered as an option rather than as the only choice available to employees. Smaller companies and self-employed individuals tend to have better ability to choose the type of health plan that best meets their anticipated and actual medical claims so this is not usually a significant issue. The popularity of high deductible insurance continues to grow but buyers are increasingly likely to purchase options that reduce the risk of a high deductible policy, according to national industry leaders UnitedhealthOne and Celtic Insurance. Currently HSAs are a better option than HRAs for most small businesses.

Tags : health saings account, consumer driven health plan

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