The coming year may be the year when “consumer-driven health plans” either attract large numbers of consumers and employers or are relegated to the category of great niche products that never quite caught on. For 2 years, benefits consultants and health policy experts have been wondering whether health savings accounts and health reimbursement arrangements were on their way to being to this decade what health maintenance organizations were to the 80s.
Thus far, the answer seems to be “no.”
Only 1.3% of the 1,600 insured, working-age adults who participated in a recent survey commissioned by the Employee Benefit Research Institute, Washington, and the Commonwealth Fund, New York, said they had employer-funded personal health accounts along with high-deductible coverage.
America’s Health Insurance Plans, Washington, includings dependents and self-funded health accounts in its total, found that the number of health account owners increased to 3.2 million earlier this year, from 1 million in March 2005.
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Either way, health account plans still appear to be only a tiny percentage of the commercial health insurance market, the authors write.
Out in the real world, “there continues to be a good bit of interest” in health account plans, says Lamar Wright, a benefits broker with The Benefit Company, Atlanta. “But there’s more talk than action.”
One problem is that the cost of the high-deductible plans used with HSAs and many HRAs is still almost as high as the cost of the traditional plans, Wright says.
Up in Michigan, “we began to see more movement toward HSAs, but more to HRAs,” says Kristopher Powell, president of BenePro Inc., Royal Oak, Mich. “The employers were happy because of the cost savings, but it took a lot of work to get the employees up to speed.”
Once an employer has a health account plan for about 3 years, the employees seem to like it about as much they like other types of plans, and the well-established health account plans do not seem to generate any more employee complaints about claims than the traditional plans do, Powell says.
Cost increases at the health account plans seem to be about 2 percentage points lower than increases at the traditional plans, and the difference adds up over time, he says.
The workers who have employer-funded health account plans said they were about 20% more likely to stay out of the emergency room and much more likely to ask doctors to prescribe cheaper drugs and avoid unnecessary diagnostic tests.
Thanks to wellness benefits, the health account plan members were more likely to say they have had Pap smears and mammograms in the past year.
But researchers who conducted a survey for the Henry J. Kaiser Family Foundation, Menlo Park, N.J., found that 9% of health account plan members reported suffering from a “temporary disability” as a result of postponing seeking medical care due to concerns about cost, compared with 5% of the survey participants in traditional plans.
Here are some other health coverage trends to watch in 2007.
Costs keeping going up. The consulting arm of Aon Corp., Chicago, is reporting that U.S. health care cost trends were up about 12% this fall for preferred provider organization plans, and up about 10.5% for health account plans.