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J Consum Policy (2006) 29:247262
DOI 10.1007/s10603-006-9008-z
ORIGINAL PAPER
Jessica Greene Judith H. Hibbard Anna Dixon Martin Tusler
Received: 15 April 2006 / Accepted: 29 June 2006 /
Published online: 25 October 2006 Springer Science+Business Media B.V. 2006
Abstract Consumer Directed Health Plans (CDHPs) are new and increasingly popular insurance products in the United States that aim to increase consumer involvement in health care decision-making. Using quantitative and qualitative methods, we examine characteristics of employees in a large rm that voluntarily enroll in CDHPs. We nd salaried and hourly high deductible CDHP enrollees to be substantially healthier and have higher educational attainment than Preferred Provider Organizations (PPO) enrollees. There was less favorable selection into a more popular, lower deductible CDHP.
Keywords Consumer-directed health plan Consumer-driven health plan High deductible health plan Health Reimbursement Accounts Health Savings Accounts Health insurance
Consumer Directed Health Plans (CDHPs) are new health insurance products in the United States that aim to increase consumer involvement in health care decision-making. In traditional health insurance plans, consumers do not face the full cost of the health services they consume. The premise underlying CDHPs is that faced with paying a greater share of health care costs, consumers will only seek necessary care, will act more responsibly in maintaining their health, and will compare prices and quality when purchasing health care, as they do when shopping for other
J. Greene (&)
Department of Planning, Public Policy & Management, University of Oregon, 1209 University of Oregon, Eugene, OR 97403, USAe-mail: [email protected]
J. H. Hibbarde-mail: [email protected]
A. Dixone-mail: [email protected]
M. Tuslere-mail: [email protected]
Which consumers are ready for consumer-directed health plans?
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commodities. This is a substantial departure from existing managed care arrangements, where physicians are the ones encouraged to contain costs through policies like capitation payments and utilization review (Robinson, 2004). CDHPs place the responsibility for controlling health care spending squarely in the hands of consumers.
CDHPs generally share the following four components. First, enrollees face high annual deductibles before insurance coverage begins. While the level of the deductible varies, in large rms it is typically $1,500 for employee-only coverage and $3,000 for family coverage (Uyoo & Chovan, 2005). It is higher for those purchasing in the individual market or working...