The use of consumer-driven health plans hasn't yet reached the critical mass that its advocates say is needed to produce universal reductions in healthcare costs.
But the use of CDHs by employers and employees is growing at rates that, perhaps surprisingly for some, exceed the dawn of HMOs back in the 1970s, according to the results of a survey conducted by Aon Consulting, in conjunction with the Brookfield, Wis.-based International Society of Certified Employee Benefit Specialists.
CDHs are savings accounts contributed to by employers, employees or some combination thereof that are used exclusively to pay for healthcare.
Out of the 470 different-sized businesses across the country interviewed for the survey, 175--or 37 percent--offered consumer-driven health plans to their employees this year. That's a 32 percent increase over the 28 percent of that same group of employers who say they offered CDHs in 2006.
Bill Sharon, the Tampa, Fla.-based employee-benefits specialist with broker Aon who quarterbacked the survey, said the rise of the CDHs reminds him of the rise of HMOs 30 years ago, only CDHs are catching on at a faster rate.
"We are only seven years into this consumer health-driven movement, which is still early in the game," Sharon said.
The survey also found that employee use of CDHs is increasing. In 2007, 60 percent of employers reported that 10 percent or more of their employees were taking advantage of CDHs. That's a 13 percent increase over 2006's rate of 53 percent.
Counterbalancing that is that, overall, 40 percent of those offering the programs said less than 10 percent of their employees use them.
In raw numbers, Sharon said 9 million U.S. employees are estimated to be using CDHs in 2007. He said 6 million were estimated to use them the previous year.
By comparison, when HMOs were rolling out in the late 1970s, Sharon said, it took from 1976 to 1980 for the number of HMO users to grow from 6 million to 9 million.
"What took four years then took one year now," Sharon emphasized.
But as to whether CDHs will help achieve the holy grail of reduced healthcare costs, an impartial observer would have to declare a mistrial at this point based on employer attitudes.
Of those employers surveyed, 39 percent said they think CDHs will reduce their health costs in the next five years. Thirty-three percent said they had no idea if they would, and 27 percent said they didn't think they would. Hardly a ringing endorsement.
But stay tuned. Sharon and his fellow researchers found that, of those businesses not offering CDH plans as an option, 42 percent were "seriously considering" offering one next year.
Featuring varying rates of deductibles, the accounts are designed to put employees in control of spending and get them in much better touch with the costs of the medical services they consume. The long-term goal is a more economical use of services and a reduction in healthcare insurance costs for everyone.
Whether you buy into that argument or not, it's an argument that will be ongoing for the next couple of years.
November 1, 2007
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