How Do Consumer-Directed Health Care Plans Affect Medical Care?

Investigating their effect on the amount, patterns and quality of health care used

    • August 8, 2012

Dates of Project: August 2006 through February 2011

Field of Work: Consumer-directed health care plans

Problem Synopsis: Consumer-directed health plans feature higher deductibles and either a health reimbursement account (employer-owned) or a health savings account (employee-owned). They are designed to make consumers more cost conscious in making health care choices. The market penetration of these plans within the employee-sponsored insurance market has been growing at an annual rate of 34 percent in the early 2000s.

Due to incentives within the Affordable Care Act of 2010, and large employers' intentions to expand these plans, researchers believe that market share may increase to 50 percent in 10 years. However, there has been very little research on the impact of these plans on the health care system, or on the cost and utilization of care by those enrolled.

Synopsis of the Work: Researchers used medical claims data for employees from 59 large employers to examine the effect of consumer-directed health care plans on cost and utilization of care, the plans' impacts on vulnerable populations (defined as lower-income and chronically ill people), and estimate the plans' future national impact. They also conducted a literature review of previous studies of these plans.

Key Findings: Families enrolling in consumer-directed health plans for the first time in 2005 spent 14 percent less than similar families enrolled in conventional plans.

The benefit designs of consumer-directed health plans almost always affected vulnerable populations to the same extent as nonvulnerable populations.

If the percentage of the nonelderly population who are enrolled through their employer in a consumer-directed health plan were to increase immediately from 12.4 percent to 50 percent, the savings in personal health care expenditures nationally—over a 10 year period—would total $57.1 billion.

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