Consider These Factors In Consumer Health Care

The stakes for engagement are high. The World Health Organization estimates that consumers now directly control $330 billion annually in out-of-pocket healthcare expenses.

Health care consumerism is a term we hear when the national health care discussion leads to how to deliver quality employee health benefits within a sustainable cost structure. The goal of health care consumerism is to provide quality health care and improve patient outcomes.

The Evolution Of Benefits

The days when most health plans offered comprehensive reimbursement arrangements after an employee met a modest deductible are long gone. Managed care plans that attempted to ration benefits at the insurance-carrier level proved to be widely unpopular.

Consumer-driven health plans (CDHPs) evolved to solve these issues. CDHPs featured much higher deductibles than what had previously been offered by commercial health plans. These CDHPs provided the patient or consumer a greater incentive to become involved in making health care decisions, especially choices that involve testing where hundreds of dollars can be saved depending on where the test is performed. The most known type of CDHP is the high-deductible health plan (HDHP).

The good news for employers and employees is how much this structure was able to reduce insurance company premiums. The potential downside is the higher out-of-pocket costs that consumers faced before hitting their deductibles. Fortunately, as these insurance products evolved, so had IRS-based programs that found ways for consumers to pay these expenses using pre-tax or tax-deductible income.

You may know these IRS-backed programs as flexible spending accounts (FSA), health reimbursement accounts (HRA) and health savings accounts (HSA). Each has different qualifications — regarding the underlying health plan — and rules about how much income can be set aside and when. A well-planned CDHP is matched perfectly with the IRS-backed program to help employees as much as possible. This precise match may require the help of a benefits planer and administrator who can create a seamless consumer experience.

Please call us if you have any questions or for help working with and navigating the 2018-2019 healthcare marketplace.

You can reach me at 925-552-7077 Office or 925-785-1161 Mobile.

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