The years-long race into HDHPs has left employers scrambling to catch up their consumer- education efforts, according to researchers.

Sept. 25—Enrollment in high-deductible health plans (HDHPs) has stabilized—if only temporarily—as employers worry they have reached the ceiling on the share of healthcare costs that workers can bear.

The share of workers with employer-sponsored insurance who enrolled in HDHPs ticked down one percentage point, to 28 percent, in 2017, according to the recently released Kaiser Family Foundation (KFF) annual survey on work-based coverage. HDHPs also are known as consumer-directed health plans (CDHPs) when paired with a health savings account.

“Even as employers are embracing consumerism through these CDHPs, you’ve brushed up on an upper limit of what employers are comfortable exposing employees to in terms of out-of-pocket costs,” said Kristof Stremikis, associate director with the Pacific Business Group on Health, which represents about 75 self-insured companies nationwide.

The HDHP enrollment decline appeared to be led by workers in firms with fewer than 200 employees. Those companies reduced their share of HDHP enrollments from 26 percent to 23 percent, according to the KFF survey.

The share of companies offering HDHPs also declined, from 28 percent in 2016 to 24 percent in 2017.

The leveling off of both figures followed years of sharp increases. For instance, the share of covered workers who enrolled in HDHPs has grown from 8 percent in 2008 and 19 percent in 2012.

Employers are mitigating the healthcare cost burden of employees through steps such as increasing contributions to HSAs and limiting the amount of deductibles, Stremikis said in a briefing.

“Employers are certainly not just interested in lowering healthcare costs and sparing no expense to do that,” Stremikis said. “They really do care about a healthy and productive workforce.”

Stremikis cited an August survey from the National Business Group on Health (NBGH) in which the estimated employee out-of-pocket costs were largely static after accounting for employer health account contributions.

The KFF survey found that average annual employer contributions to premiums for workers in HSA-qualified HDHPs were $4,855 for single coverage and $12,532 for family coverage in 2017, similar to the contribution amounts last year.

Consumer Education

The years-long race into HDHPs has left employers scrambling to catch up their consumer-education efforts, according to researchers.

Rachel O. Reid, MD, associate physician policy researcher for RAND Corporation, said CDHPs appear to save money because enrollees in those plans use fewer services of all kinds—not only low-value services.

Reid described research in which she and others examined CDHPs and found that switching to a CDHP was not associated with a significant change in low-value spending.

“So consumers are not targeting low-value services in particular to cut,” Reid said.

Cutting wasteful spending in particular might require different or more nuanced insurance designs, with targeted cost sharing with low-value services as compared to high-value ones, according to Reid. Alternatively, designing provider-facing programs that incorporate a knowledge of practice patterns may reduce those low-value services.

Another way that employers could derive more value from HDHPs is by making greater use of the Choosing Wisely campaign, which offers a list of top services that providers should question based on their likelihood of offering low value.

“There is built-in asymmetry of information in the practice of medicine, and patients aren’t always in a position to weigh what is high- or low-value care,” Reid said. “Patient education about particular services has to occur in the context of provider education, as well as in outreach to providers.”

Looking Beyond HDHPs

Some payers are looking to move beyond the cost savings of HDHPs by providing better information on cost and quality to enrollees.

Health Care Service Corporation, which sells Blue Cross and Blue Shield plans, aims for “transformation into active consumers of care,” said Tom Meier, vice president of market solutions.

The insurer has aimed to achieve such a transformation by giving enrollees care-quality information on in-network providers, provider reviews by other enrollees, and comparative cost information on providers.

“We quickly realized that that wasn’t enough, and for a member to use this information it has to be personalized to them,” Meier said.

Information on providers thus is overlaid with an individual member’s benefits and financial obligations.

The insurer hopes to continue to encourage consumerism when enrollees have low deductibles or have reached their maximum out-of-pocket costs by offering a cash incentive in addition to strategically designed benefits. The program, Member Rewards, was launched at beginning of 2017 and has saved the company $500 million in net claims—after paying the cash rewards.

Another initiative, Health Advocacy Solutions, officially starts next year, but early adopters have seen “significant cost savings” by eliminating unnecessary care and redirecting to optimal sites of care, Meier said.

“You have to have solutions that actively engage members because otherwise you are developing or seeing all of the opportunities and then not realizing it, or developing solutions and they are not being used,” Meier said.

Other Trends

The NBGH survey found that almost nine in 10 employers (88 percent) expect to use centers of excellence (COEs) in 2018 for certain procedures, such as transplants or orthopedic surgery. Bundled payments or other types of alternative payment arrangements will be used in 21 to 48 percent of COE contracts, depending on the medical procedure or condition.

“When it comes to centers of excellence and travel surgery, certainly an increasing number of employers are exploring that and offering that to their employees,” Stremikis said.

Four or five PBGH companies participate in employer-driven COE networks, which provide price and outcomes information to employees and encourage them to get care at those facilities.

“Whether that’s a strategy that can be adopted by many, many employers across a range of conditions, I don’t know,” Stremikis said. “There are limitations to the travel surgery model, just as there are limitations to reference pricing, which only works with shoppable services.”

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Monday, September 25, 2017