Get Behind the Wheel with Consumer-Driven Healthcare (CDHC)
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Over the past few years, wellness and preventative initiatives have been popping up in companies and organizations across the nation. Spending dollars on employees’ healthcare now, in order to save money in the long run, is an enticing concept that is continually proven effective.
Prevention literally pays when it comes to health. Consumers are beginning to understand the direct connection between living a healthy lifestyle and reduced medical expenses, and are beginning to view health as an economic asset.
Enter consumer-driven healthcare (CDHC). The consumer-driven model is all about educating the patient, not keeping him or her in the dark. A consumer-driven health plan (CDHP) generally pairs a high-deductible plan (HDHP) with a health savings account (HSA). The deductible is at least $1,250 for single employees and $2,500 for families. With such a plan, employees would pay medical expenses out-of-pocket or by using their HSA until the deductible is met.
CDHC is based on the premise that the consumer is gaining information, taking responsibility and becoming more in touch with the true cost of healthcare. So this participant is, by design, more open to learning about the benefits of prevention and wellness care.
HDHPs focus mainly on coverage for preventive care. In other words, the deductible doesn’t have to be met just to have a routine physical. Most plans allow for up to five wellness visits per year. In addition, recommended preventive screenings are also covered. Having employees who improve their health through preventive care will save the employer and beneficiary money in the future from diseases or health conditions that could have been prevented.
This entire CDHC concept is centered around creating choices for the beneficiaries and their families. A major choice, planning for future unexpected illnesses and medical attention, can be easily facilitiated with an HSA. HSAs allow patients to save money on premiums, set aside pre-tax money to pay for out-of-pocket expenses, and pay with cash when the time comes. That means savings on the front end, tax savings throughout the year and the negotiating power of cash at the point of service. CDHC creates choices for every transaction, and can be a cost-efficient alternative to traditional health plans.
Here are a few fast facts to consider when comparing CDHPs that are focused on wellness and preventative initiatives to traditional plans:
- Participants in CDHPs are 50% more likely to ask questions and seek treatment alternatives independantly
- Wellness programs with high participation votes can earn $3 ROI for every dollar spent
- HDHPs with HSAs have proven to save 43% based on premiums
Winning the Race!
Here at Assurance, we helped a paper recycling company client save $57,772 in annual premiums by expanding upon their consumer-driven high deductible plan during a restructure of their employee benefits offerings. During the restructure, we were able to combine their employee benefits offerings under one higher quality plan and improve their PPO network. With prevention playing such a primary role in customer-driven health care, we added a wellness initiative, and implemented Employee Benefit Summaries, monthly newsletters and enrollment meetings. As the years pass, savings for both parties will surely grow as more employees steer their health, and costs, in the right direction.
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