The Hidden Costs of High-deductible Health Plans

As rising health care costs continue to make a significant impact on companies’ bottom lines, more employers are sharing those costs with workers. One of the most popular solutions is to offer employees a high-deductible health plan (HDHP), often with a savings option. But there may be hidden costs. The question to ask is, does such an approach keep employees healthier?

Interest in high-deductible health plans is growing. According to Towers Watson, 75 percent of employers offered HDHPs in 2015, up from 53 percent from 2010. And PwC found that 25 percent of U.S. employers offer only high-deductible plans, nearly double the amount in 2012.

High-Deductible Plans: The Pros

By offering employees plans with higher deductibles, along with higher copays and shares of coinsurance, employers are able to bring down their portion of the overall costs of those plans. Also, the thinking goes, when employees have to pay a higher percentage of the bill, they’ll shop for more inexpensive care—choosing to visit an urgent care center rather than an emergency room, or asking their doctors whether certain tests are absolutely necessary.

Early studies bear this out. The American Journal of Managed Care reports that families enrolling in HDHPs or consumer-directed health plans (CDHP) spent 14 percent less than similar families enrolled in conventional plans. And families in firms offering an HDHP or CDHP spent less than those in other firms. It should be noted that significant savings for enrollees were realized only for plans with deductibles of at least $1,000.

High-Deductible Plans: The Cons

While high-deductible plans have certainly saved companies on the overall cost of plans, employers should be aware of an unintended consequence. Not all employees are taking better care of themselves.

PwC reported that cost shifting pushes employees to become more deliberate about their health care choices. To save money on their own health care costs, some employees are delaying their care or avoiding it altogether. In 2015:

•  28 percent of employees skipped seeing a doctor

•  24 percent skipped prescription medicine or took less medication than prescribed

•  16 percent skipped a procedure or treatment

Such behavior can have a detrimental affect on an employee’s health—and a company’s. Employers also suffer as sick leave from improper care affects worker productivity.

The problem with high deductible health plans

Education is the Best Medicine

To help lower the overall cost of care and give their employees the treatment they need, companies can inform their workers of better ways to receive care. For instance, wellness visits do not count against an employee’s deductible. And carriers like Kaiser Permanente (formerly Group Health) stress preventive medicine to help keep workers from getting sick in the first place. Accessing urgent care rather than the emergency department for non-life-threatening issues can save anywhere from 74 to 94 percent in costs.

There are also lower cost care options available. Kaiser Permanente offers its members various avenues of care, from a free call to a Consulting Nurse Helpline to online visits for treatment of common medical issues. Both cost less than a traditional visit to the doctor’s office. For convenient care, Kaiser Permanente offers CareClinics at Bartell Drugs.

So if you’re considering adopting a cost-sharing approach to health care for your employees, augment that effort with tips on the importance of preventive care as well as how to access care in less expensive ways. Taking this approach is a win-win for management and workforce.