Consumer-Directed Health Plans have increased in popularity but are only marginally helpful.
Consumer-directed health plans (CDHPs) intend to control costs by shifting the financial risk of health care decision-making from payers to patients. CDHPs require consumers to enroll in a high deductible health plan (HDHP) with either a Health Savings Account (HSA) or a Health Reimbursement Account (HRA), use sophisticated information tools to distinguish between high and low value care, and then make decisions on health care based on that knowledge. The goal is to expose patients to the financial consequences of their medical decisions and drive value-based purchasing of health care. While CDHP enrollment initially grew slowly in the late 1990s, it has increased more rapidly in recent years, rising from 8% to 17% of covered workers between 2009 and 2011. This synthesis reviews 45 articles published between January 2002 and December 2011 addressing the evidence about CDHPs and their effects on utilization, cost, and quality.
The overall results of the synthesis suggest that the CDHP strategy is a successful approach to cost containment primarily by reductions in pharmaceutical and outpatient expenses. Evidence suggests significant cost savings of 5-14%. CDHP premiums tend to be lower than those of competing traditional plans. Differences in premiums by plan reflect three factors: the out-of-pocket payments, enrollee health status, and utilization and prices of services.
When employers offer CDHPs alongside other plans, CDHPs experience favorable selection based on age and/or health status. CDHP consumers have higher income levels and education than enrollees in other plans. An analysis based on the Employee Benefits Research Institute (EBRI) annual survey suggests CDHP enrollees have better self-reported health status and more health conscious behaviors (e.g. lower rates of smoking and higher rates of exercise).
The evidence is unclear on how CDHPs affect utilization. While some studies suggest that consumers indiscriminately reduce utilization, others provide evidence that CDHP enrollees reduce use of less clinically appropriate care. As an example, CDHP enrollees responded by cutting back on ED visits for low severity rather than high severity issues.
One argument in the health care debate is that the solution to skyrocketing spending is the empowerment of patients, providing them with choice (in service and provider) and allowing market forces to reduce the cost of service down to what patients are willing to pay. Results of this study seem to reinforce this thinking through the CDHP model for low and medium risk enrollees. This makes sense when you examine the CDHP model. A low to medium risk population already represents low utilization, their need for sophisticated information tools is minimal, and their cost for less complex treatment is at the low end of the spectrum.
Now take the word “choice” out of the discussion, add in complexity of care for a high-risk, high demand enrollee, and subtract conclusive, unbiased information on an effective course of management and you find out why the CDHP has little effect on patients in this category. For high-risk patients, those who consume the bulk of health care dollars, value is based on a set of criteria beyond the value of a product or service. For them, value is measured in the results of a product or service – quality of life, or even life instead of death – where value cannot be quantified in dollars and cents.
Patrick Fitzgerald, MPH