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1st Quarter 2010 Executive
Summaries
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One aspect in our troubling economy that seems to be flourishing is the growing number of employers implementing consumer-driven health (CDH) plans and wellness programs. This article describes the primary areas of participant behavior that consumerism seeks to change and the fundamental factors a “consumer-focused” health care strategy must include. The authors outline issues employers must address when designing a successful incentive program and its accompanying communications strategy. A case study of a company that has a 70% enrollment rate in its CDH plans shows how an integrated consumerism and wellness strategy can slow the rate of health care cost increases for both the employee and employer.
Health Savings Accounts: Back to the Future
by Kathy Klug and Lois Chianese, Buck Consultants, an ACS company
Health savings accounts (HSAs) have altered the health care landscape in ways no one might have predicted. HSAs have emerged as a valuable tool in the quest to change consumers' health care spending behaviors and better manage health care costs. This article compares and contrasts HSAs to various other health care spending accounts, addresses various HSA topics in the context of HSAs' first six years, and speculates on the future of HSAs. The authors identify policy changes that could help expand HSAs, drive further employer savings, make HSAs more userfriendly, impact employee satisfaction and increase adoption rates.
Health Care Consumerism Movement Takes a Step Forward
by Michael Thompson and Charles M. Cutler, M.D., Pricewaterhouse Coopers
One of the contributing factors to both the increase in health care costs and the backlash to managed care was the lack of consumer awareness of the cost of health care service, the effect of health care costs on profits and wages, and the need to engage consumers more actively as consumers in health care decisions. This article reviews the birth of the health care consumerism movement and identifies gaps in health care consumerism today. The authors reveal some of the keys to building a sustainable health care consumerism framework, which involves enlisting consumers as well as other stakeholders.
Health Care Consumerism: Incentives, Behavior Change and Uncertainties
by Sander Domaszewicz, Linda Havlin and Susan Connolly, Mercer
Employers affected by the recession's 2009 peak must press for cost containment in 2010, especially in health care benefits. Encouraging employee consumerism—through consumer-directed health plans and other strategies—can be enhanced by incentives, but federal efforts at health care reform add some element of uncertainty to the consumer-directed solution. This article provides some lessons to guide the course of action for employers considering implementing a consumerist approach to improve employee health and control cost trend.
Mythbusters: The Facts Are in About Consumer-Driven Health Plans
by William J. Reindl, CIGNA
Do consumer-driven health (CDH) plans have the potential to help create a more affordable, sustainable (i.e., multiyear), high-quality health care system? Or do they merely shift costs and cause individuals to forgo care? For the past four years, CIGNA has compared actual claims data of individuals covered in its CDH plans with those of its traditional health maintenance organization (HMO) and preferred provider organization (PPO) plans, among the same employers. The results consistently show that properly designed CDH plans deliver lower medical and pharmacy costs without sacrificing care or shifting costs. And CDH plans, if designed properly, increase preventive care and, on average, individuals tend to receive a higher level of care while costs are reduced. If health care reform goals are to be achieved, well-designed CDH plans should play a significant role.
What 's Next for Consumer- Directed Health Plans?
by Lale Iskarpatyoti, Towers Watson
Although over half of employers currently offer a consumer-directed health plan (CDHP), the median plan enrollment rate for individual companies is low, at just 14%. This article explains factors underlying low enrollment rates by reviewing the history of CDHPs and examining whether CDHPs have lived up to their initial value proposition in terms of cost reduction and consumer behavior change. The author identifies the sentinel effect that CDHP concepts have had on traditional plans and where further actions and developments are needed to change employee behaviors and increase enrollment in CDHPs.
Looking Beyond Health Reform: The Future of Consumer-Focused Health Care
by Jeff Munn, Hewitt Associates
The prevalence of the consumer-driven approach to health care will dramatically increase in the years ahead. This article first looks at the ongoing health reform debate to see the limited impact it will have on consumer-driven health care. It also looks at the current limits of the reform conversation, within the context of several societal trends that will collectively drive the longer-term development of consumer-driven plans. While health reform may tinker around the edges of what tools are available, these broader trends all point toward greater and greater consumer involvement in both health and health care. At issue is whether the current consumer-driven model can adapt to accommodate these changes.
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