Consumer-Directed Health Plans: A Best Buy or a Goodbye?

The Kaiser Family Foundation surveyed almost 1,400 people enrolled in the new “ownership society” model of health insurance, the consumer-directed health plan.

You could look at the results and say that the incentives intended to make them more conscious of health care costs and, thus, better consumers, are working well. But you could look at the same results and say the model is so scary that half the enrollees want to bail out.

Consumer-directed health plans offer lower premiums and a tax advantage to those who roll the dice, put money aside and figure their medical expenses will be low. The gamble is they may not be low or the consumers will decide to do without care if they can keep the money.

Kaiser reports that 71 percent say they do consider cost more than they used to, and more than half say their approach to care is different. So it works.

But Kaiser also says that half the enrollees would switch back right now if they could, and twice as many of the guinea pigs went without care as those in traditional plans. So it doesn’t work.

Whether half-full or half-empty doesn’t matter so long as the glass is clouded. The real story in this report is, as suspected, that most people can’t find information they can trust about the real cost of health care.

So, before insurers ask people to carry a bigger share of the risk, and before government proclaims some sort of ideological success, they both must require health care providers to put price tags and quality ratings on their products.

Just like at Best Buy.

1 thought on “Consumer-Directed Health Plans: A Best Buy or a Goodbye?”

  1. This sounds like spin to support a personal agenda toward a single payer or socialized health care system.

    The math is already in on that, they’re unsustainable. If there’s a problem with a system that harnesses the natural tendency of people to save money rather than engage in the moral hazard of pursuing the most expensive treatment possible under their insurance plan, then the new system needs to be repaired not abandoned.

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