Many workers aren’t ready for health care reform

Original article

By Diane Stafford

National health care reform and cost-cutting by employers is changing the way many workers get health insurance, but a majority of employees may not understand what’s ahead.

The Aflac WorkForces Report, the insurer’s third annual employee benefits study, polled 5,299 employees across the country and found that three-fourths said they had never heard the phrase “consumer-driven health care.”

That’s a problem. Consumer-driven health care is the direction the nation is moving. It’s the underlying concept that requires individuals to take more control over their health care spending.

“It may be referred to as ‘consumer-driven health care,’ but in actuality, consumers aren't the ones driving these changes, so it’s no surprise that many feel unprepared,” said Audrey Boone Tillman, executive vice president of corporate services at Aflac.

There’s another problem. The survey found that more than half of the workers polled said they preferred not to have greater control over their health insurance options. Fifty-four percent said they don’t have the time or knowledge to manage the responsibility.

How will workers learn to navigate the world of health care and insurance choices? Seventy-five percent said they expect their employers to educate them about the details of reform.

There’s another problem. Only 13 percent of the 1,884 “benefits decision-makers” in organizations reached in a companion poll said they thought educating employees about health care reform is “important” to their organizations.

At least most employees realize they’re not ready. About half said they fear they will leave their families less protected if they make poor insurance plan choices.

The poll, released Wednesday, emphasized the education challenges as employers shift away from their health care benefits.

One-third of the employees polled said they weren’t knowledgeable about health savings accounts, three-fourths said they weren’t knowledgeable about the impending federal or state health insurance exchanges, half said they weren’t knowledgeable about health reimbursement accounts and one-fourth said they weren’t knowledgeable about flexible spending accounts.

All of those are benefits options for employers to subsidize employee health care in different ways or exit health benefits entirely.

“It’s time for consumers to face reality,” Tillman said. “The responsibility lies in the hands of consumers to educate themselves.”

Employers Take Another Look at CDHPs

While consumer-driven health plans (CDHPs) have been shown in the past to generate savings for employers and workers alike, the CDHP movement now might be losing some steam, according to a pair of industry studies.

CDHPs -- high-deductible health plans (HDHPs) often paired with health savings accounts -- made up 22.5 percent of all health care plans offered in the U.S. in 2012, according to the latest release from the UBA Health Plan Survey. That figure compares with 22.9 percent in 2011 -- the first decline since 2007.

There's no shortage of research that points to the positives of these types of plans. A recent study by the Kaiser Family Foundation found that HDHPs had average premiums of just under $5,000 for single coverage in 2012 -- about 15 percent less than preferred provider organization (PPO) plans, according to a report in MarketWatch. Another report by the RAND Corp. noted that patients with CDHPs tended to see significantly lower overall medical costs and used fewer brand-name drugs.

Statistics like those -- and a challenging economic outlook -- have moved more employers to offer CDHPs, said Helen Darling, president of the National Business Group on Health, in the MarketWatch report.

"Now that there's been this economic crunch and wages are flat, the increased costs of health care are harder to take," Darling said.

Yet at the same time, employers are starting to see some downsides to consumer-based care, the RAND study notes. Patients with chronic conditions often see much higher out-of-pocket expenses than those without a chronic disease. The plans also may discourage employees from obtaining medical care, which can lead to bigger costs down the road.

"The concern is that [those enrolled in CDHPs are] forgoing care that they need," said Amelia M. Haviland of the Carnegie Mellon University and co-author of the RAND study in MarketWatch.

CDHPs also aren't achieving as much first-year savings for some employers. The 2012 UBA Health Plan Survey found that the savings created by CDHPs in their first year over the plans they were replacing averaged 1.75 percent in 2012, a significant reduction from prior years.

Still, the survey spotted a few bright spots for these types of plans. The negative trend of CDHPs renewing at higher rates compared with other plans did not repeat in 2012, and CDHPs continue to remain popular in particular regions of the U.S. -- especially in the Northeast, where 27.8 percent of all plans were CDHPs.