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The wheel keeps on turning.

In the 1960s, health insurers were selling “indemnity plans” that gave consumers the right to choose their own doctors but guarded against “moral risk” by using high deductibles and 20% co-payment rates to discourage overuse of medical services.

The health maintenance organization brought tight management of care and $5 co-payments for office visits in the 1980s.

Today, we have consumer-driven health plans, which use health reimbursement arrangements or health savings accounts and old-fashioned high deductibles to encourage appropriate use of medical services.

How are the new high-deductible plans different from the old high-deductible plans?

A look at the differences illustrates just how much health coverage has changed.

Some major differences are Web-based administration, provider directory systems and the use of debit cards to help free employees from filing the tedious paper claims that employees often had to file back in the 1960s and early 1970s.

Nurse support lines are another innovation. In the past, patients without close relationships with doctors had no place to go for advice about whether or not to visit the emergency room. Now, carefully trained nurses can help employees assess their immediate medical needs.

The new high-deductible plans also offer access to carefully selected provider networks made up of doctors and hospitals that, in many cases, offer in-network patients significant discounts.

Finally, unlike many of the old indemnity plans, many modern high-deductible plans give employers the option of purchasing preventive care benefits.

This all raises another question: “How are the new high-deductible plans different from ordinary, high-deductible managed care plans?”

In the long run, the best answer may be that giving employees a chance to establish HRAs or HSAs may help them get more involved in decisions about medical treatment as well as their finances. Early indications are that HRA and HSA holders pay far more attention to the “self care” information on the Web.

is vice president of product design and development at Humana Inc., Louisville, Ky. She can be reached at bbierbower@humana.com.


Reproduced from National Underwriter Edition, April 15, 2005. Copyright 2005 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.