Editor’s note: This is part two in a two-part series.
In last month’s Smart Business, we examined the growing trend toward consumer-directed health plans.
In such plans, employees, armed with more information, are given more control over the allocation of their health care dollars. Such plans typically feature an employer-funded health savings account combined with a high-deductible traditional health plan.
With health care costs on the rise, some employers are moving toward these consumer-directed health plans in an effort to balance costs and promote consumer engagement in their health care decisions.
Things to consider
When evaluating consumer-directed plans, considerations for both employers and employees include:
* Depth and breadth of information available to the consumer. With decision-making shifting to the employee in these plans, the need for comprehensive, consumer-friendly information to help them make good choices becomes critical.
In a 2002 Watson Wyatt survey, 37 percent of businesses surveyed were looking for ways to give employees more information about their health care benefits. Plans that offer personalized, Web-based information, especially data about prescription drugs and hospital options, will be of greater interest to companies as they seek to arm employees with the facts they need to make appropriate health care choices.
* Availability of value-added programs. Programs such as 24-hour nurse phone lines, disease management support and nurse case managers can provide critical information and should be considered when selecting a consumer-directed plan. These programs can also provide further savings to employers.
* Choice and flexibility in the plan. Plans that cover preventive care services without a deduction from a health savings account or without being subject to the deductible can improve employees’ satisfaction with their health benefits. Some plans may also tier hospital or provider networks as a means to control employer costs while giving consumers the option of getting care from a more costly provider.
* Deductible limits. While there are no limits on employer contributions, companies typically fund 50 percent to 75 percent of the deductible amount. Look for plans that offer a wide range of deductible levels when considering consumer-directed plans.
As more companies explore the use of consumer-directed health plans, it is important to recognize how such a plan might benefit your employees. Businesses whose overall benefit strategy focuses on reining in health care costs while providing more employee choice are often more open to plans with a health savings account.
For others, a plan that gives employees a set amount of funds from which to purchase health care coverage in the open market might be the preferred product.
Although more businesses are exploring the use of consumer-directed health plans to help empower consumers and control costs, they are generally not yet replacing traditional coverage options. Instead, they should be viewed as another opportunity for employers looking for creative benefit solutions. Gregory C. Donnelly ([email protected]) is vice president, sales manager, sales division of Cigna HealthCare. CIGNA HealthCare is one of the nation’s leading providers of health-benefit programs, with managed care networks serving 45 states, the District of Columbia and Puerto Rico. CIGNA HealthCare provides medical coverage through managed care and indemnity programs to more than 13.3 million people, including more than 250,000 in major Ohio markets. Reach Donnelly at (216) 642-2573.
