The Pros and Cons of Consumer-Driven Health Plans
Nothing is more appealing to healthcare consumers than empowerment. They like having control of healthcare expenses and knowing exactly how their plans work so that they can make them work for them. It makes sense that this notion has led to the popularity of consumer-driven health plans.
What are Consumer-Driven Health Plans?
Consumer-Driven Health Plans (CDHPs) use pre-tax funds to pay for medical expenses. These types of health plans have accounts you can put this money into like health reimbursement accounts (HRAs), flexible spending accounts (FSAs) and health spending accounts (HSAs). While the co-pays are higher than typical health insurance plans, the monthly costs are less expensive, making it an appealing option.
But are they worth it? We weigh the pros and cons.
The obvious pro to consumer-driven health plans is that they are cheaper. It’s a big reason why these plans have grown in popularity. Healthcare costs have climbed for years and in 2020, healthcare spending grew 9.7%, which equates to $12,530 per person. A great way to lower that burden is by cutting the monthly costs if the insurance member is relatively healthy and isn’t going to the doctor that often.
Con: Higher Co-Pay
While it’s nice to pay less each month, the co-pays can add up if the member ends up going to the doctor more often than they’d like. Plans like this one may not be the best for people who expect to go to the doctor regularly or know that they want to move forward with a pricey procedure.
Consumer-driven health plans are perfect for people who want flexibility with their healthcare spending. Some members may want to use their healthcare funds on health-related products and not so much on visits. Or maybe they just want flexibility with paying for healthcare costs that aren’t tied to just their credit card. And with the spending accounts being pre-taxed, their money stretches further.
Con: High Deductible
A high deductible means a higher expense after repeated utilization. It may not matter at all if the member has no intention of reaching anywhere near their deductible, but if they do, that’s a lot of unnecessary expense when the member could have paid a higher monthly payment instead and avoided co-pays. It’s a matter of trade-offs based on anticipated care needs, and members can use help navigating these options.
How to Understand Healthcare Consumers
There are healthcare consumers looking for options just like these plans, but want to work with an insurance provider that understands their needs. The Insights Accelerator™ allows providers the tools they need to market to all types of healthcare consumers using healthcare consumer research data compiled by PatientBond. This data and the use of PatientBond’s easily integrated digital engagement tools can help providers increase enrollment and care adherence.
Unlike other platforms, PatientBond uses psychographic segmentation to motivate healthcare consumers to act on their health. Certain psychographic segments are more likely to use high deductible health plans than others, and there are segment-specific ways to communicate the advantages and disadvantages of HDHP’s, CDHP’s and other insurance types to motivate healthcare consumer decisions and choices.
Interested in the insights and data to drive member enrollment and loyalty? Visit our webpage on the Insights Accelerator™ to learn more.