Employers searching for effective, long-term ways to rein in rising health costs should make it a point to take a closer look at this strategy.
New research indicates consumer-driven health plans (CDHPs) are can significantly reduce health costs.
By how much? The average cost savings per employee over a five-year period for workers enrolled in a CDHP compared to employees who were enrolled in traditional health plans (PPO, HMO) was $9,700.
In addition, in the first year of switching to a CDHP, workers had 16% lower medical costs, compared to employees in traditional plans.
These stats are based on the sixth annual Cigna Choice Fund Experience Study. The study compared individuals enrolled in a CDHP to those in traditional plans like a PPO or HMO.
The results go a long way toward confirming what many employers already suspected: CDHPs are an effective long-term strategy for keeping rising health costs at bay.
Here are some of the other major highlights of the Cigna study:
- When employers switched to a CDHP, their employees had a 10% lower risk profile (chance of developing or worsening a chronic condition) than workers in a traditional plan.
- Employees with a CDHP who were enrolled in a pharmacy management program had 14% lower pharmacy costs than workers in a PPO/HMO.
- Workers with a CDHP went to the emergency room at a 13% lower rate than workers in traditional plans.
Plus, employees who were enrolled in CDHPs sought preventive care more frequently, were more likely to participate in a health risk assessments or coaching programs and were more likely to compare medical costs than individuals with PPOs or HMOs