Self Insured

Health care accounting


During the last decade, more than 4.5 million Americans have enrolled in "consumer-driven" health care plans. Such plans typically feature health savings or reimbursement accounts coupled with insurance that kicks in only in the case of an extremely expensive medical catastrophe. The idea is to control costs and increase patient choice by having individuals pay for routine care out of funds they control directly, while still providing a safety net to guard against massive expenses such as a heart transplant or cancer care. According to a recent report by the American Academy of Actuaries, consumer-driven plans not only drastically reduce costs but do so without sacrificing health outcomes.

The report, which reviewed four industry-conducted studies of cost and care decisions in consumer-driven plans, showed first-year cost reductions of between 4 percent and 15 percent after patients switched to the new system. While the report cautioned that continuing savings were difficult to measure, it tentatively concluded that all four of the studies reviewed "seem to indicate that there may be a favorable effect on ongoing cost trends." That's in marked contrast to traditional insurance plans, which tend to increase in cost each year. The report also found that, contrary to the conventional wisdom, people enrolled in consumer-driven plans use significantly more preventive care than people in traditional plans.

While these four studies are not definitive, the report's authors say no credible study contradicts their findings. Boosters of universal insurance typically take a dim view of consumer-driven health care, but the research is hard to ignore: The best way to get prevention and savings is to give individuals the power to take care of themselves.

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  1. The monograph states that they researched whether “CDH designs result in any first-year cost savings and/or favorable effects on cost trends beyond the first year? “. They concluded that “continuing savings were difficult to measure” because “HSAs are owned by the member, complete funding and utilization data for the HSA is generally not available.” The study should have concluded if you were a chameleon and needed health insurance for your lifespan then we can undoubtedly say you will save money otherwise we have no clue.

  2. Very interesting article. I’m inclined to agree with it as I’ve been learning about consumer-driven healthcare in a book called “Bend the Health Care Trend” by Mark S. Gaunya and Jennifer A. Borislow. They are strong advocates of engage, educate and empowerment of consumers when it comes to healthcare. I’ve really learned alot.

  3. My only point is that if you take the Bible straight, as I’m sure many of Reasons readers do, you will see a lot of the Old Testament stuff as absolutely insane. Even some cursory knowledge of Hebrew and doing some mathematics and logic will tell you that you really won’t get the full deal by just doing regular skill english reading for those books. In other words, there’s more to the books of the Bible than most will ever grasp. I’m not concerned that Mr. Crumb will go to hell or anything crazy like that!

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