Consumer Power Report: Consumer-Driven Plans Deliver

Published December 1, 2007

I was pleased to moderate a session at the National Consumer Driven Health Care Summit in September at which Jennifer Vachon presented the latest findings from the Blue Cross Blue Shield Association.

Vachon, executive director of the association’s Marketing and Consulting Services Group, summed up the results by saying, “These findings show us that [consumer-driven health care plans] are beginning to deliver on their promise. Our survey shows that CDHPs empower consumers and help them become more engaged in their health care decisions.”

Of the Blue national accounts, 19 percent currently offer Health Savings Accounts (HSAs), and 17 percent offer Health Reimbursement Accounts (HRAs), up from 12 percent and 10 percent, respectively, in 2005, according to the information provided at the conference. CDHPs are taken up by 19 percent of employees who are offered HSAs and by 35 percent of those who are offered HRAs.

The numbers of employees likely or very likely to continue their coverage the following year is similar for CDHPs and non-CDHPs.

Better Health

The age and health status of CDHP and non-CDHP enrollees are very similar, but the HSA-eligible enrollees tend to have somewhat higher incomes and education levels.

HSA enrollees are much more likely to research health information, including:


  • doctor quality: 20 percent of HSA enrollees, 14 percent of non-CDHP enrollees;


  • doctor costs: 14 percent of HSAs, 4 percent of non-CDHPs;


  • hospital quality: 12 percent of HSAs, 7 percent of non-CDHPs;


  • hospital costs: 10 percent of HSAs, 3 percent of non-CDHPs; and


  • insurance information: 25 percent of HSAs, 17 percent of non-CDHPs.


HSA enrollees are much more likely to plan and save for future health care expenses:


  • track health care expenses: 63 percent of HSAs, 43 percent of non-CDHPs;


  • estimate future health care expenses: 38 percent of HSAs, 19 percent of non-CDHPs; and


  • save for future health care expenses: 47 percent of HSAs, 18 percent of non-CDHPs.


CDHP enrollees are much more likely to participate in wellness programs:


  • smoking cessation programs: 20 percent of HSAs, 6 percent of non-CDHPs;


  • stress management: 22 percent of HSAs, 8 percent of non-CDHPs;


  • nutrition programs: 27 percent of HSAs, 12 percent of non-CDHPs; and


  • exercise programs: 29 percent of HSAs; 12 percent of non-CDHPs.


HSA enrollees are no more likely to forego care due to cost:


  • did not go to doctor: 18 percent of HSAs, 18 percent of non-CDHPs;


  • delayed treatment: 17 percent of HSAs, 17 percent of non-CDHPs; and


  • delayed prescription: 15 percent of HSAs, 15 percent of non-CDHPs.


The survey was conducted by Knowledge Networks of 3,000 people enrolled in Blue and non-Blue CDHPs and non-CDHPs. Vachon said a forthcoming study by the Mercer Company will show the results for HRAs are not as strong as for HSAs.

Source: “Blue Cross and Blue Shield Association Survey Shows Consumer Driven Health Plan Enrollees Are Taking More Control of Their Healthcare,” Blue Cross Blue Shield Association, September 28, 2007:

Clinics Relieve Doctors’ Burden

Charles Peck, M.D. is chief medical officer for the Take Care Clinics that have been acquired by Walgreens. Many physicians dislike these clinics, but Peck looks at them from the consumers’ point of view, and they make a lot of sense.

Peck says family-practice physicians are under enormous pressure from increasing costs and lower reimbursements from insurers and government programs. Fewer physicians are going into primary care, which makes it difficult for many patients to get timely appointments–and once they do, it often means long waiting times, inconvenient hours and locations, and ever-greater out-of-pocket costs. Physicians may not be at fault for any of this, but patients suffer.

Peck said his clinics are not trying to replace physicians. Instead, the clinics insist that patients have a “medical home” and refer them to local physicians to develop ongoing relationships with doctors.

The clinics treat only a very limited and specific set of conditions–their primary benefit is in reducing the burden on hospital emergency departments, where 72 percent of all visits are not emergencies.

Convenient, Economical

Peck said while his clinics accept most major insurance plans, 40 percent of their patients ask them not to file with the insurance company, preferring to pay cash and avoid the health-plan hassle. The most common conditions treated are strep throat, sinus infection, ear infection, bronchitis, and dermatitis/poison ivy. The charge ranges from $59 to $74 per visit.

Peck expects Take Care Clinics to be operating in 400 Walgreens pharmacies by the end of next year. Several employers, colleges, and hospitals are also talking with the group about setting up on-site clinics in their facilities.

HSAs Could Help Michigan

Michael LaFaive of Michigan’s Mackinac Center for Public Policy writes that Michigan could help solve its budget problem and save $194 million by switching the state employee group to HSAs. He says the best estimate of premium savings is about one-third, and that the state spent $590 million in health benefits in 2006.

However, it would be a mistake to capture all of that in one-time savings to the employer. The real savings in HSA conversion occurs over the long term–the annual rate of increase in insurance premiums industry-wide is 6 to 7.5 percent, but in HSAs it’s only 2.5 percent a year. HSAs work best (and generate less resentment and resistance) when the employer makes a substantial contribution to the account.

If the state had made the conversion a few years ago it would already be enjoying the benefits of lower health insurance premium rate increases. But it shouldn’t try to take a short cut and make up for it in one year. That is the kind of short-term thinking that got the state into a budget crisis in the first place.

Source: “Health Savings Accounts Could Save State $194 Million,” by Michael D. LaFaive, Mackinac Center for Public Policy, September 28, 2007:

Greg Scandlen ([email protected]) is president of Consumers for Health Care Choices, an advocacy group based in Hagerstown, Maryland.