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Employers key in keeping high-deductible plans from compromising employee health

Employers key in keeping high-deductible plans from compromising employee health

Workers with high deductibles are skimping on necessary care, some studies warn, but experts say there are ways employers can sidestep the concern before it weighs on future health costs.

High deductible health plans are meant to encourage workers to shop smarter for health care services and eliminate unnecessary or redundant care by giving those workers a bigger stake in the overall cost.

But sometimes, covered employees are reluctant to pay the high out-of-pocket costs that often come with a high deductible plan and put off needed care, which can lead to worsening conditions and higher health costs in the long-term, some studies show.

According to a study released Friday by New York-based nonprofit Commonwealth Fund, 40% of people with high deductibles said they had not gone to the doctor when they were sick, had not gotten a preventive care test, skipped a recommended follow-up test, or had not gotten specialist care they needed because of their deductible. The report characterizes a high deductible as 5% or more of a person's income.

Additionally, 43% of all adults surveyed by the Commonwealth Fund said their deductible is difficult or impossible to afford.

Deductibles have continued to creep higher: A September survey of nearly 2,000 employers by the Kaiser Family Foundation said the average deductible this year was $1,318 for individuals, up from $1,217 last year and $917 in 2010.

Experts say there are several factors that contribute to whether employees will put off needed care, and employers play a huge role in ensuring they don't.

“It's really all about communication and education,” said Larry Boress, Chicago-based president and CEO of the Midwest Business Group on Health, adding that many employers have not done a good job explaining the ins and outs of consumer-directed high deductible health plans.

Because high deductible plans are new for many employees, they don't know what's covered. For example, some employers haven't explained that preventive care is free under the Patient Protection and Affordable Care Act, including services like screenings and immunizations.

Those employers “end up having people not getting the services, believing they've got to pay out of their pocket, and then ultimately getting sick or getting worse, or having a condition and ending up in the hospital emergency department,” Mr. Boress said.

And many don't understand that high deductible plans can often be cheaper than preferred provider organization and health maintenance organization plans, he said.

According to a Mercer L.L.C. survey released last week, the medical plan cost per employee enrolled in CDHPs linked to health savings accounts averages $9,228 versus $11,212 for preferred provider organization plans and $11,248 for health maintenance organization plans.

In addition to educating employees on the basics of their health plan, employers should provide them with the means to do what the consumer-directed high deductible plan was meant to do: encourage individuals to be hands-on consumers of their health care.

“Employers should have tools available to help people with their care decisions to make sure they are going to … quality providers that provide care for less out of pocket,” said Steve Wojcik, vice president of public policy with the National Business Group on Health in Washington. Tools range from providing price transparency to comparison shopping, among others.

When workers have the tools needed to make smart health care decisions, they “really think twice or they shop around saying, 'OK, this physician is charging three times more than that one and they both meet the quality standards, so why don't I go to this one?' ” Mr. Wojcik explained.

Such tools help lower the overall use of care by encouraging smart choices and ultimately reduce costs for both the employee and employer, experts say.

And to ensure workers don't skimp on necessary care, employers can provide contributions to the health savings accounts at the beginning of the year, so workers have the funds when they need them and don't have to worry about out of pocket costs.

“There's greater opportunity, and people I think are more satisfied and use their benefits more when the employer contributes,” Mr. Boress said.

According to an August NBGH study of 140 large employers, while the majority of employers provide some sort of contribution to workers' HSAs and health reimbursement arrangements, 13% of employers don't contribute any funds to plan members' accounts.

Still, some disagree on whether high deductible health plans actually deter needed care, and some experts say most of the care forgone is low-value and often unnecessary.

For instance, a Cigna Corp. study showed that when comparing the insurer's CDHP members with managed care plan members, both showed the same or higher compliance with 500 evidence-based medical practices 96% of the time.

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