Consumer-driven health plans (CDHPs) continue to grow in popularity due to the opportunities they offer both employers and employees. According to America’s Health Insurance Plans (AHIP), CDHP enrollment rose to 17.4 million in 2014, an increase of 6 million since 2011.
Consumer-driven health plans can be distinguished from traditional health plans by their higher annual deductibles and the opportunity to invest in a Health Savings Account (HSA). Higher deductibles make members more mindful of the cost of their care, which promotes comparison shopping and reduces utilization of unnecessary treatments and overpriced providers and prescriptions. A recent study found that members who switched to a CDHP from a traditional plan saw an average 10.5% reduction in combined medical and pharmacy costs, and a 23.5% reduction in inpatient care costs.
Although CDHPs offer clear benefits, employers should resist the urge to embrace a consumer-driven strategy without first planning to address increased employee needs for education and decision support tools. Employee communications regarding CDHPs should begin 15-18 months in advance, include a mix of communication formats (electronic, video, print, in-person), and provide plenty of visuals and examples. Providing employees with high-quality decision support tools enables them to make the informed health care choices that ultimately lower costs.
While traditional health plan costs were most affected by plan design, CDHP costs are impacted more by how a member uses their plan. Because of this, many insurers and third-party vendors offer online transparency tools that help CDHP members make informed healthcare decisions. These tools commonly provide information on health education, the member’s HSA account and personal health record, and hospital and physician costs and quality. Most transparency tools offered by health plans reveal only the average cost of services, but some third-party vendors provide data on specific unit-cost pricing and actual billed amounts.
To learn more, visit AHIP at http://www.ahip.org/Press-Room/2014/HSA-Census-Survey/.