Keep These in Mind as Sen. Baucus Releases Health Care Draft

By September 16, 2009Health Care

Investor’s Business Daily, page one, “45% Of Doctors Would Consider Quitting If Congress Passes Health Care Overhaul

Investor’s Business Daily, perspective column, “Some Firms Are Already Bending Stubborn Health Care Cost Curve.

In a normal market, consumers rule. If prices get too high, consumers stop buying or seek out alternatives. The rapid rise in health care costs, followed by a rise in health insurance premiums, has been driving employers and insurers to find less expensive alternatives. Hence, the growing trend toward what’s known as consumer-driven health plans (CDHPs).

CDHPs typically combine a high deductible health insurance policy — say, a $3,000 to $5,000 deductible for a family — with a tax-free account, usually a health savings account (HSA) or health reimbursement arrangement (HRA).

The authors, Roy Ramthun and Merrill Matthews, report the results of adopting such plans:

  • For Cigna, costs in CDHPs in their first year went down 4%; those in Cigna’s traditional plans went up by 9%.
  • Aetna saw a decline of 10% for CDHPs vs. an 8% increase in traditional plans.
  • Uniprise experienced a 15% drop in CDHPs vs. a 7% rise in traditional plans.
  • WellPoint compared its group insurance accounts in 2008 and found HMO and PPO rates went up 7% to 10% from the previous years, while CDHPs went down.

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