We have emphasized the value of flexible spending accounts, health reimbursement arrangements and health savings accounts for many years. As these consumer-directed health plan (CDHP) options continue to become more widespread, trends show that they are producing positive results.
Lower Health Care Risk
Surveys conducted by a major insurance carrier show that when employers moved to CDHP offerings from PPO and HMO plans, plan participants improved their health-risk profile by 10% in the first year.
Lower Overall Medical Costs
In CDHPs, the medical-cost trend was 16% lower than in traditional plans during the first year. Over five years combined, cost savings for those enrolled in CDHPs averaged $9,700 per employee. These reductions in cost were achieved without employers shifting out-of-pocket health expenses to their employees.
Enrollment in HRAs and HSAs is on the upswing, growing by approximately 14% in 2011. Surveys by the Kaiser Family Foundation show that more than 17% of workers participating in employer-sponsored plans currently have HSAs or HRAs, up from just 4% in 2006. The Health Affairs journal estimates that if half of all employer group enrollees were in CDHPs, 7% of all health care spending, or $57 billion, could be saved annually. Other studies project that the savings could exceed 9% of total U.S. health care spending.
Increased Cost Consciousness
According to a recent analysis by the Employee Benefit Research Institute, a private, nonpartisan, nonprofit research institute based in Washington, D.C., individuals participating in CDHPs are more likely than those with traditional coverage to show cost-conscious behaviors. According to the 2011 survey, those in a high-deductible health plan with an HSA or HRA were more likely to do the following:
For More Information
Contact ASR/Physicians Care at (616) 957-1751 or (800) 968-2449 for more information.
Lower Health Care Risk
Surveys conducted by a major insurance carrier show that when employers moved to CDHP offerings from PPO and HMO plans, plan participants improved their health-risk profile by 10% in the first year.
Lower Overall Medical Costs
In CDHPs, the medical-cost trend was 16% lower than in traditional plans during the first year. Over five years combined, cost savings for those enrolled in CDHPs averaged $9,700 per employee. These reductions in cost were achieved without employers shifting out-of-pocket health expenses to their employees.
Enrollment in HRAs and HSAs is on the upswing, growing by approximately 14% in 2011. Surveys by the Kaiser Family Foundation show that more than 17% of workers participating in employer-sponsored plans currently have HSAs or HRAs, up from just 4% in 2006. The Health Affairs journal estimates that if half of all employer group enrollees were in CDHPs, 7% of all health care spending, or $57 billion, could be saved annually. Other studies project that the savings could exceed 9% of total U.S. health care spending.
Increased Cost Consciousness
According to a recent analysis by the Employee Benefit Research Institute, a private, nonpartisan, nonprofit research institute based in Washington, D.C., individuals participating in CDHPs are more likely than those with traditional coverage to show cost-conscious behaviors. According to the 2011 survey, those in a high-deductible health plan with an HSA or HRA were more likely to do the following:
- check whether their plan would cover care
- ask for a generic drug instead of a brand-name drug
- talk to their doctor about treatment options and costs
- talk to their doctor about prescription drug options and costs
- develop a budget to manage health care expenses
- check the price of a service before getting care
- use an online cost-tracking tool
For More Information
Contact ASR/Physicians Care at (616) 957-1751 or (800) 968-2449 for more information.