There are those that proffer consumer driven health care as a panacea for our nation's health care ills. President Bush was a principal sponsor of health savings accounts ("HSAs"), a component of the Medicare Prescription Drug, Improvement and Modernization Act of 2003. The concept of HSAs is to provide top advantaged savings accounts whereby individuals can use their pre-tax dollars to pay for deductibles and other expenses not covered by insurance and roll over any savings resulting from non-expenditures into future years.
A whole industry has grown up over the use of the concept of HSAs, known generally as consumer driven health care. The idea is that, since individuals can set up their own HSAs, they will be incented to investigate and determine the most efficient use of their funds for healthcare. This will result in a consumer dominated industry that purchases healthcare goods and services based upon market principles of education, knowledge and self service.
The health insurance industry has been quick to react to the promise of the consumer driven insurance market with the offering of a number of different insurance models including:
The Health Reimbursement Account ("HRAs") - a high deductible managed care plan with a Section 105 Health Expense Bank partially funded through employer contributions.
The Tiered Network Plan - a managed care plan wherein network providers are classified by degree of efficiency (and generally where benefits vary year by year).
Plan Choice Model - where benefit plan customized by employee and which allows employee to design an individual plan by selecting from a number of available networks, deductibles, copays, out-of-pocket limits, etc.
Personalized Provider Network Plan - employee customizes provider network.
Voucher - employee uses employer cash contribution to purchase individual coverage in the open market.
See Deloitte & Touche, 2003 Consumer-Driven Health Care Survey (April, 2003)
Some look upon the rise of consumer driven health care plans as the heir and replacement of managed care programs. "I believe consumer driven care will fundamentally transform existing relationships between major healthcare participants by moving to a more consumer (a.k.a., patient) centered system." Richard L. Reece, M.D. "Consumer Driven Care: Eight Directions for 2005," Healthleaders News, December 6, 2004.
"Consumer-driven" health care will certainly grow as more and more employers seek to deflect rising health care costs to their employees.
Critics of consumer-driven health care are concerned about the long-term effects of these plans. They note that patients must frequently pay at least 2 thousand dollars in addition to premiums before health coverage kicks in. The programs favor healthy and wealthy individuals and leaves the working poor and chronically ill to carry a greater financial burden. They worry it is another favor the rich scheme that will delay the consideration of a universal health coverage system. See Gail Shearer and Susanna Montezmolo, "The False Promise of 'Consumer-Driven' Health Care," The Health Care Divide - Center for American Progress. www.americanprogress.org.
Comments