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The U.S. Master Pension Guide reflects the latest regulations, rulings and cases for qualified retirement plans, surveying the different type of plans from which an employer may choose, and describing the procedures for obtaining plan qualification.

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CCH® BENEFITS — 6/18/07

Successful Consumer-Driven Health Plans Integrate Wellness And Prevention

from Spencer’s Benefits Reports: Health care plan members taking greater responsibility for health care decisions “present a viable opportunity to address shortcomings in the [health care] system,” according to an Aon Consulting report entitled The Impact of Consumer-Directed Health Plans with Integrated Health Improvement Services on Health Care Consumers. The review paper was prepared by Tom Lerche, health care practice leader in Aon’s health and benefits practice. “In particular, consumer-directed health plans with integrated health promotion and wellness programs and member decision-support tools achieve stronger success in motivating and modifying member behavior to reduce health risk factors and health services utilization,” Mr. Lerche wrote.

The Aon study looked at the consumer-driven health plan (CDHP) models offered by the South African firm Discovery, which has offered a Destiny Health CDHP product in several states in the U.S. for the past five years. This review “confirms the long-term viability of a CDHP approach,” including the following outcomes:

• A CDHP account with member savings accounts (either health reimbursement arrangements or health savings accounts) leads to a “direct and sustained reduction in the consumption of medical services.” For example, Aon found that Destiny claims for chiropractor services were less than two-thirds the applicable industry average and that the number of emergency room visits was more than 15% lower than for the insurance industry as a whole, even with no copayment requirement.
• Short-term cost savings are not achieved at the expense of avoiding necessary care.
• An integrated CDHP that includes a wellness program supports preventive care and does not “necessarily result” in reduced use of these services. Ultimately, this integration leads to improved health and lower long-term care costs, and reduced employer and employee insurance renewal premiums. In the U.S., more than 80% of Destiny members began either a nutrition or exercise program in the preceding 12 months, Aon noted.
• A well-implemented CDHP program combined with “engaged” plan members leads to greater acceptance of and satisfaction with the CDHP design.
• In the Discovery/Destiny plan designs, CDHPs can work for members with chronic diseases, providing first-dollar coverage for prescription drugs for chronic diseases such as diabetes, high blood pressure, and high cholesterol, and incentives to improve health.

“The experience of Aon Consulting with plan sponsors in the U.S., U.K., and South Africa and evidence cited from Discovery/Destiny in three different health care systems suggest that members taking greater responsibility for health care decisions present a viable opportunity to address shortcomings in the system,” Mr. Lerche wrote.

“We believe U.S.-based plan sponsors should consider incorporating coverage for integrated wellness services—as well as coverage for maintenance medications for members with chronic diseases,” Mr. Lerche concluded. “Specifically, we see the medication coverage as providing a mechanism to facilitate the move by employer groups to a full replacement CDHP solution that accommodates the specific needs of members with chronic conditions.”

For more information, visit http://www.aon.com.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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