In the move to consumer-driven plans, the decision-making process involvesthree key design considerations, says Jay Coldwell, product director, nationalaccounts, Wausau Benefits, Inc. Wausau, Wisconsin.
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Structure.
The structure must be designed to provide real cost-savings andto encourage employees to take a conservative approach to spending. For example,some plans bundle prescription drugs into the items covered by the personalaccounts to encourage prudent use. Coldwell also recommends that employers offerflexible spending accounts to help employees meet out-of-pocket health-carecosts with pretax dollars. Another important structural consideration is thechoice of networks. "Effective networks are critical to long-term cost-savings," he says. -
Patient education. Especially when employees have more responsibility forhealth-care costs, disease-management programs are critical. "Employers canoffer nurse help lines and proactive screenings for prevention and earlytreatment of costly illnesses," Coldwell says.
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Information on quality and costs. Some consumer-driven plans offer atiered network of PPOs, with each tier representing a separate care systemdifferentiated by specific quality standards and costs. In the absence of atiered network, employers can provide Web-based information to help participantsselect high-quality, cost-effective hospitals and physicians.
Coldwell says that a carefully designed consumer-driven plan with the rightnetwork can save employers 20 percent in the first year, and year over year, thetrend increase is lower. Human resources can reduce adverse selection byslotting the consumer-driven plan as the middle offering, with a less expensivecatastrophic-coverage plan below and a more expensive traditional PPO above. "Make sure that the consumer-driven plan is not the cheapestoption," he says.
Workforce, February 2003, p. 40 -- Subscribe Now!
