|Health Factors:||Quality of Care|
|Decision Makers:||Community Members Employers & Businesses Healthcare Professionals & Advocates|
|Population Reach:||50-99% of WI's population|
|Impact on Disparities:|
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Consumer-directed health plans (CDHPs) are high deductible health plans (HDHP), often paired with medical expense accounts funded with pre-tax dollars. These accounts may be Health Reimbursement Arrangements (HRAs) or Health Savings Accounts (HSAs). Employers fund HRAs and permit employees to use them for medical costs up to a stated limit. Employers may help fund HSAs, but employees manage funds and retain them when changing jobs. Federal law requires minimum deductibles for HSAs, but not for HRAs (Haviland 2011). HSA HDHPs have legal maximum out-of-pocket costs, but HRA HDHPs do not have legal limits on out-of-pocket costs (KFF-Employer health benefits 2013).
There is mixed evidence about the effects of consumer-directed health plans (CDHPs). Overall, CDHPs can reduce short-term health care costs by inducing participants to seek less health care (EBRI-Fronstin 2010, Haviland 2011).
CDHP participants have been shown to reduce office visits, recommended screenings (Fronstin 2013, Haviland 2011), procedures, and overall care (Haviland 2011). Participants are also more likely to reduce prescription drug use (Fronstin 2013), especially those with chronic conditions (Haviland 2011) such as hypertension (EBRI-Fronstin 2010). Most CDHPs cover preventive services; however, participants often do not realize this (EBRI-Fronstin 2010) and forgo preventive care (Haviland 2011). After several years with a CDHP, participants may increase emergency department visits (Fronstin 2013).
Families that have CDHPs have been shown to spend an average of 14% less on health care than families with traditional health plans (Haviland 2012). About two-thirds of the cost savings associated with CDHPs come from forgone care. The remaining cost savings come from choosing less expensive care alternatives such as using generic drugs, avoiding hospital stays, and visiting fewer specialists (RAND-Haviland 2012). CDHPs with HSAs appear to reduce spending more than CDHPs with HRAs, especially on outpatient services and prescription drugs (Haviland 2011).
As of 2013, 23% of US firms offered an high deductible health plan with savings option. Large firms are more likely to offer the option than small firms; in 2013 43% of firms with 1,000 or more employees offered high deductible plans with a savings option (KFF-Employer health benefits 2013).
The Affordable Care Act (ACA) allows HDHPs, though over 70% of plans offered in the HealthCare.gov Marketplace have deductibles under $3,000, and out-of-pocket costs are capped at $6,350 for single coverage and $12,700 for family coverage (CMS-Healthcare.gov 2014). Under ACA, all plans must offer free preventive care (PBS-Kane 2012).
Most states, including Wisconsin, do not tax HSA contributions (HSA for America).
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