Tag Archives: CDHC

Health Insurance

CIGNA CDHC Results

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Cigna has released the latest of its reports on the experience of its consumer-driven health plans (CDHPs). The study of 655,000 CIGNA enrollees found:

  • Immediate and sustainable cost savings: CDHP medical costs are 14% less than traditional plans the first year, cumulative cost savings rise to 19% in the second year, 23% in the third year and 26% in the fourth year.
  • Higher levels of care: People with CIGNA Choice Fund received recommended care at compliance rates that were similar or better than those covered by traditional CIGNA health plans. Key indicators such as use of preventive care, evidence-based care and disease management program participation were measurably better among those in CIGNA CDHPs than those in PPOs and HMOs.
  • Less cost for those with chronic conditions: Medical cost trend was substantially less for CIGNA Choice Fund customers with hypertension (27% less), joint disease (21% less), and diabetes (15% less), than for individuals with either of those diseases in traditional CIGNA health plans. According to the study data, these cost savings were achieved without sacrificing care.
Health Insurance

Half the Employers Offer Consumer Directed Health Care Plan

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A Watson Wyatt report finds that:

Just more than half (51 percent) of companies now offer workers a CDHP, up from 47 percent in 2008. Another 8 percent are expected to adopt a CDHP by 2010. CDHPs are helping employers control costs – companies with at least half of their workers enrolled in a CDHP have a two-year cost trend (4.6 percent) that is 25 percent lower than non-CDHP sponsors (6.1 percent).

The cost of coverage for CDHPs is considerably lower than for either PPO/POSs or HMOs for 2009. Employee-only coverage for CDHPs is $852 lower than for other plan types. For family coverage, CDHP rates are $2,146 below the median PPO/POS plan rates and $2,350 lower than the average HMO plan costs.

Health Insurance

Aetna: CDHC Lowers Costs, Improves Care

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Aetna compared six years of experience for 2.2 million Aetna members in traditional coverage and 400,000 in a HealthFund CDH plan. Its press release says:

The results show that Aetna HealthFund members are seeking increased levels of chronic and preventive care, using generic drugs more often and accessing online tools and information at higher rates than PPO members, while experiencing lower annualized medical cost increases. Importantly, this year's results also show that Aetna HealthFund members had lower emergency room use than PPO members, suggesting that members are becoming better informed about where to access health care.

It also found:

  • For full replacement HRA and HSA plans, employers saved $21 million per 10,000 members over the five year period.
  • For employers who offer Aetna HealthFund plans as an option, they experienced savings of $7 million per 10,000 members over the five year period.
  • For employers who offer Aetna HealthFund plans as an option and implemented the strategies that Aetna identified as best-in-class, they achieved savings of $23 million per 10,000 members over the five year period

On all measures of consumer behavior HealthFund enrollees meet or exceed that of traditional enrollees, but also had 10% lower utilization of primary care physicians and 15% lower use of specialists, and seek preventive care and use consumer tools and information at a greater rate than PPO members.

Health Care Costs

Consumer Health Plans Growing, Have Lower Costs

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This is from an upcoming survey by Watson, Wyatt and the National Business Group on Health:

  • More than half of companies now offer consumer directed health plans (CDHPs).
  • Employee-only CDHC coverage costs $852 less than other types of plans.
  • For family coverage, CDHCs are $2,146 lower than PPO/POS plans and $2,350 lower than the average HMO plan.

Hat tip to Grace-Marie Turner.

Health Insurance

Another Bad Study

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A brand new report by Linda Blumberg and Lisa Clemens-Cope of the Urban Institute and funded by the Robert Wood Johnson Foundation repeats the tired old mantras we've been hearing for 15 years.

They argue that HSAs are okay for the healthy and wealthy, that the sick and the poor can't afford to pay the higher deductibles, that people can't effectively shop for health care services, that HSAs are ripe for tax cheating, and that they aren't very popular in any case. They support these views by relying on old information and discredited sources and by ignoring any research that runs counter to their predetermined views.

First, for the easy stuff. This report relies a great deal on a GAO report that came out last year. That is how it concludes that market penetration is only 2% and that HSA account holders are much wealthier than others. The GAO report was using very old data. Its enrollment numbers were from 2006, and its wealth estimates were even older – 2005 – when HSAs were still brand new. Further, it measured "wealth" by comparing HSA account holders to all tax filers, including the uninsured, people on Medicaid, people in the military, etc. Honest researchers would not have relied exclusively on this information, especially when much more robust and contemporary data is readily available. Continue reading Another Bad Study →

Health Alerts

UnitedHealthcare Studies CDHC

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The company has compared results over a five-year period for 266,000 consumer directed health (CDH) plan enrollees using Health Reimbursement Arrangements (HRAs) with 147,000 preferred provider organizations (PPO) enrollees. After adjusting for demographics, health status, etc., here are the results:

  • Pharmacy costs were 18% to 23% lower in the CDH plans and medical costs were 4% to 8% lower.
  • Overall costs were 7% to 9% lower in the CDH plans, with the savings growing through time (employers saved 10% and 12% in 2006 and 2007, respectively).
  • About 82% to 87% of employer savings were the direct result of utilization decreases rather than cost-drifting to employees. Continue reading UnitedHealthcare Studies CDHC →
Health Insurance

Health Affairs Slams CDHC

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Jamie Robinson and Paul Ginsburg have paired up in Health Affairs to take another shot at consumer driven health care. This is one of the most peculiar articles I’ve read on the subject. You can tell which author wrote which part of the piece. Ginsburg (Center for Health System Change) has long been a skeptic who is willing to look at the evidence. Jamie Robinson (UC Berkeley), on the other hand, has been consistently foaming-at-the-mouth hostile. About a year and a half ago he gave a speech to the Consumer Driven Summit where he declared the death of consumer driven health care (CDHC) in favor of what he termed “managed consumerism.” He had a list of about ten particulars, but as we wrote at the time, he was wrong on every single one. He just hadn’t bothered to look at the evidence. Continue reading Health Affairs Slams CDHC →

Health Insurance

Blue Cross Survey

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The Blue Cross Blue Shield Association has released its 2008 survey of member experience in CD Health plans. There is a lot of information here, not all of it positive:

  • 70% of consumers report that an HSA-eligible product is (now) available to either them or their spouse/partner.
  • Blue Cross Blue ShieldApproximately 25% of consumers who are given a choice of plans choose an HSA-eligible product, but the percentage choosing an HRA has dropped from 23% in 2007 to 12% in 2008.
  • There is very little difference between those who choose a CDHP plan and those who choose a non-CDHP in terms of age, income, or health status.
  • People in HSAs are far more likely to be concerned about the cost of care, to track their expenses, and to choose lower-cost options for treatment. They are also more likely to participate in wellness programs.
  • Both groups are equally likely to comply with treatment for prevention and for chronic care, but people in CDHPs saved a lot of money due to reduced utilization – $616 per member for those who had a choice of plan and $1,074 per member in a full replacement group.
  • The percentage of people in an HSA-eligible program who do not plan to open an account has grown from 29% in 2007 to 46% in 2008. Nearly half of them (48%) say they don't see the value in having an account and 30% say they can't afford to make a contribution.
Health Insurance

Blue Cross Survey: CDHC Plans Working

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Blue Cross Blue Shield Association has unveiled the results of its latest survey of Consumer Driven Health Plans (CDHP). This year’s presentation reveals that:

  • BCBS enrollment in CDHPs has grown 50% in the last year, with 2.9 million in HSA programs and 1.5 million in HRAs.
  • Distribution of age and income matches very closely with the distribution for non-CDHP enrollment.
  • People who choose a CDHP want to have more control over costs and utilization.
  • Compared to people in a non-CDHP plan, people with HSAs are far more likely to ask their doctor about the cost of a recommended treatment (52% to 33%), choose a lower cost option (36% to 23%), and use mail order for buying Rx (43% to 30%).
  • They are also far more likely to track their health care expenses (72% to 40%), estimate future expenses (38% to 22%), and discuss expenses with their doctor (38% to 27%).
  • They are about 50% more likely to participate in wellness programs.
  • They are slightly more likely to use preventative services and equally likely to receive necessary services and comply with prescribed treatment.
  • Savings due to reduced utilization equal $1,074 per member in full replacement groups and $615 for multiple choice groups.
  • Still, this year for the first time, CDHP enrollees are somewhat less likely to recommend the coverage to others (38% to 45%).