Wednesday, April 23, 2008

Do consumer-driven health plans save money?

…Does the term consumer-driven health plan sound like “The Patriot Act” to you? You know—named to please?

…Often (Republican) people like to say these plans, in which the insured is invited to pay a big deductible out of a tax-advantaged fund, give us more “choices.”

…Again, sounds good. But who is benefiting? Recently, Paul Fronstein and John MacDonald of the Employee Benefit Research Institute (EBRI) took a look (WSJ, Apr
22, 2008).

…Problem: Sometimes this fund thing is to be fed by the insured—another thing that costs money. The employer may match or fund all, but maybe not, too.

…Finding: People are not leaping at these things.7% of consumers have opted to go this route.

…These are not helping the uninsured. They can’t get these, either, or don’t get them.

…Almost a third of people who have them are in the high income group--$100K or more.

…Participants tend to be less satisfied than people in other plans, although satisfaction is rising.

…Participants are more cost-conscious. They talk about costs to doctors. They bargain.

…People in these plans are shown to skimp on care.

…And, there has been no significant improvement in ways to find out about costs and the reputation of providers in order to tell where to put your buck.

…The bottom-line is not in yet, but employers may be saving 1.5% on these. High cost-sharing by employees mean they use the services less.

…One of HA’s favorite novelists, Jonathan Kellerman, recently had a piece in the WSJ about how he paid for an MRI out of pocket and they gave him “such a deal” ($1000 or so) when he said he was paying. He then advocated that we all just pay doctors and would be so much better off.

…Hey, we can’t even afford the partial payments, Mr Famous Guy.

…When is someone in DC going to notice that it costs a LOT to pay 20% of a hospital bill? Plus premiums. Plus funding your little medical account. We can’t all get treated at Bethesda Naval Hospital.

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