CDHPs Second Most Common Plan Design Offered By Employers

from Spencer’s Benefits Reports: Consumer-driven health plans (CDHPs) have surpassed health maintenance organizations (HMOs) to become the second most common plan design offered by U.S. employers, according to research from human resource consultant Aon Hewitt. The 2012 Health Care Survey found that in 2011, 58 percent of employers offered a CDHP and 38 percent offered an HMO. Preferred provider organizations (PPOs) continue to be the most widely offered plans, with 79 percent of employers offering these plans in 2011. The survey contains responses from nearly 2,000 employers representing over 20 million U.S. employees and dependents.

Among employers that offer CDHPs, health savings accounts (HSA) outpace health reimbursement arrangements (HRA) by two to one (34 percent versus 18 percent). However, Aon Hewitt’s survey shows a higher number of employees enrolling in HRAs, with 43 percent of employees enrolling in HRAs, compared with 28 percent in HSAs.

To encourage employees to enroll in CDHPs, employers are using a variety of tactics, including subsidizing premiums at a higher level than other plan options (36 percent), covering preventive medications before the deductible (34 percent), and contributing employer funds to the HSA (30 percent) and HRA (22 percent), the survey found.

Communication Critical

According to a separate survey of 3,000 employees and their dependents by Aon Hewitt, The Futures Company, and the National Business Group on Health, employees are willing to try CDHPs and their associated accounts and will continue to choose them because they often come with a lower premium. However, employees find them challenging to understand and use.

“Employees want to choose the most cost-effective plan with the least hassle, but they often have very full lives and are not all that interested in digging into the details of CDHPs, HSAs, and HRAs,” said Joann Hall Swenson, partner and health engagement best practice leader at Aon Hewitt. “Our research and experience tells us that simply giving employees lots of educational information about these plans and accounts is only helpful to the small minority of people who like all the details.”

To address this, Aon Hewitt advises employers to:

Get the right people into the right plan. Employers should identify segments of their population most likely to value and take advantage of the unique features of the CDHP, and tailor the marketing campaign to them. Also, they should monitor employees’ day-to-day experience of using the plan to ensure it “re-sells” itself and engages consumers in the appropriate health and financial behaviors.

Reinforce the plan’s advantages and actions. Employers should articulate how it will benefit their employees—specifically how they can benefit from the plan’s key features—and be very specific about the actions employees need to take.

Make it easy for employees and their families to use the plan. This includes removing barriers to care at the point of need through initiatives like value-based plan designs or fully funding employer contributions to HSA/HRA accounts at the beginning of the year.

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