Consumer-driven health plans continue to increase in popularity, representing a growing share of the commercial health insurance market.
Among other things, these plans can create greater price awareness of treatment options and reduce use of unnecessary services, bringing down overall health care costs.
CDHPs are designed to help consumers approach health care expenses prudently and maximize health benefits by making better choices about how they spend their health care dollars.
One way benefit plan advisors can help employers and consumers get the most out of CDHPs is to make sure they know how to get care at in-network rates.
CDHPs and in-network rates
Consumer-driven health plans typically require the consumer to pay a deductible before the health plan pays for services. Some critics of these plans mistakenly believe that the consumer does not get the benefit of the health plan discount during the period where the deductible has not been “satisfied.”
If the plan is underwritten by a health insurer that offers a network, or the self-funded employer has contracted with a network, make no mistake–the plan discounts do apply during this period. It is important that individuals take advantage of the network discounts that insurers offer as the discounts can provide substantial savings.
To ensure that they are getting the full benefit of the discount, consumers should ask the provider to submit the claim to the health plan before paying for the service. Once the health plan has processed the claim and the consumer has received the explanation of benefits, she can then pay the appropriate amount.
“Up front” payment requirements
On rare occasions, providers will require payment at the time of service. When this happens, the consumer should ask the provider to factor in the health plan discount.
Most providers have a pretty good idea of what the health plan’s allowable charge is for routine services. If the amount the provider charges is greater than the amount the consumer owes, the consumer can ask that the provider issue a refund after the claim has been processed.
Some providers do ask for these payments “up front” as they are concerned about getting paid. Many providers are aware of the use of health care debit cards tied to flexible spending, health reimbursement or health savings accounts.
When a consumer has such an account, some providers are willing to have the consumer sign an authorization form that allows the provider to debit the consumer’s credit card after the claim has been adjudicated.
These types of arrangements are usually win/win for both the consumer (who does not tie up funds unnecessarily) and the provider, who has an increased comfort level in receiving payment.
Another way to pay less
In the event the consumer does not have insurance or does not have access to a network, he can and should engage in cost discussions. According to a 2005 Wall Street Journal Online/Harris Interactive Health Care Poll, 70% of adults who negotiated for lower prices for a medical bill were successful.
While staying in-network is crucial to helping your clients save money, there are other ways to help consumers save money and turn them into savvy health care shoppers.
? Most health plans have a number of Web-based tools that can help a consumer understand the cost of an office visit, a drug, an MRI or most other major procedures. These tools are becoming more widely available, yet many consumers have not taken full advantage of what they can offer.
? In addition to cost information, most health plans also offer information on the quality or efficiency of services for certain types of providers. For example, it is relatively easy to find information on a hospital including costs for a procedure, the number of procedures the hospital has performed, infection rates and so on.
? Consumers also have some alternatives to traditional care at a reasonable price. Many large retailers are beginning to house “quick” clinics within their walls. These clinics are not designed to replace the consumer’s primary care physician, rather they are designed to be alternatives for emergency rooms or when a consumer cannot get in to see their family doctor. These clinics post their prices so the consumer knows what the price is before he/she receives treatment.
? Another way to maximize the discounts the health plan offers is to use mail order for prescription drugs. In most situations the cost for mail order is less than what a consumer pays at a retail pharmacy, sometimes as much as one month’s copay. And, mail order adds the convenience of being delivered to your home. Look for mail order services not only for routine prescriptions but also for much higher cost specialty drugs.
Real-time claims adjudication
An emerging trend that will help consumers understand the cost of their care at the time of service is real-time claims adjudication. This approach is being more widely adopted and is essentially a technique that allows the payment transaction to occur while at the doctor’s office.
Providers can electronically enter the consumer’s information and know precisely what a consumer owes. The system avoids the incidences of overcharging and having to reimburse later. There is no more waiting to bill the consumer or for the bill to be paid.
Simplifying the claims process and reducing payment errors by incorporating real-time claims is a step in the right direction for change. These systems can re-price in-network claims in agreement with negotiated contracts and whenever possible, help obtain maximum savings through negotiated charges.
Finally, CDHPs are becoming increasingly attractive and accessible to your clients. Given the increasing popularity of these plans, and the many ways to save with them, you have a great opportunity to educate your clients about cost-saving approaches.
Beth Bierbower is vice president, product innovation, at Humana Inc., Louisville, Ky. She can be reached at .