Cigna’s customer base for consumer-driven health plans (CDHPs) grew by 26 percent in the U.S. in 2012, resulting in one in five of its health insurance customers now participating in a health savings account (HSA) or health reimbursement arrangement (HRA) instead of a traditional health plan, the insurer reported.
The insurer’s Seventh Annual Cigna Choice Fund Experience Study compares the claims experiences of more than 2.5 million customers enrolled in a CDHP, a traditional preferred provider organization (PPO) plan or a health maintenance organization (HMO) plan.
CDHPs are health plans linked to either an employee-owned HSA or an employer-owned HRA (see the SHRM Online article Consumer-Driven Decision: Weighing HSAs vs. HRAs). HSAs must be linked to high-deductible health plans (HDHPs) that have lower premiums and higher deductibles (at least $1,250 for employee-only coverage in 2013) than traditional health plans. Most HRAs are also connected to HDHPs, though there is no statutory requirement for this. With both HSAs and HRAs, contributed funds that the employee hasn't spent during the year to pay for unreimbursed health care costs accumulate and can be used for future health expenses, which is the "skin in the game" that’s meant to encourage employees to make cost-conscious spending decisions and to adopt healthier behaviors.
According to Cigna’s study, CDHP incentives are operating as intended. When compared with customers in traditional PPO and HMO plans, those in a CDHP:
- Lowered their health risks. CDHP customers reduced their risk of developing or worsening a chronic condition. The study found that when employers fully transitioned to offering only a CDHP option, individuals improved their health risk profile by 6 percent in the first year compared with workers in a traditional plan.
- Reduced total medical costs. The annual cost-growth trend for CDHPs was 13 percent lower than for traditional plans. Costs were 20 percent lower for HSA customers and 11 percent lower for HRA participants. Notably, 75 percent of HSA customers contributed more to their accounts than they spent.
- Were more engaged in health improvement. CDHP customers were twice as likely to complete a health risk assessment, and those with a chronic illness were up to 25 percent more likely to participate in a disease-management program than those enrolled in a traditional plan.
- Were more likely to compare cost and quality. CDHP customers were 59 percent more likely to use the directory to find cost and procedure information to help them review potential medical costs.
- Were more savvy about health care. CDHP customers were more likely to choose generic medications compared with those in a traditional plan. In addition, CDHP enrollees used the emergency room at a 6 percent lower rate than did individuals enrolled in HMO and PPO plans.
- Received higher levels of care. CDHP customers had consistent or higher compliance with more than 300 evidenced-based medical best practices than did their counterparts in traditional plans. Those in a CDHP also sought preventive care, such as annual office visits and mammograms, more frequently than did traditional plan enrollees.
"CDHP customers are more engaged with their health and health spending, they spend less to receive the same levels of recommended care and are more satisfied with their health care experience,” said David M. Cordani, Cigna president and chief executive.
Stephen Miller, CEBS, is an online editor/manager for SHRM.
Consumer-Driven Health Plan Participants More Cost-Conscious, SHRM Online Benefits, December 2012
Consumer-Driven Plans Are Now Second Most Common Design, SHRM Online Benefits, September 2012
Satisfaction Levels Up for CDHPs, Down for Traditional Plans, SHRM Online Benefits, September 2012
Study: Switch to CDHPs Cuts Health Care Spending, SHRM Online Benefits, June 2012
HSA Plan Growth Continues; Most Provide Decision Support Tools, SHRM Online Benefits, June 2012
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