• Consumer-Driven Health Plans

    Give your employees control over their own medical expenses.

    Patients with a consumer-driven health plan are twice as likely as patients in traditional plans to ask about cost and three times as likely to choose a less expensive treatment option. And, chronic patients with a CDHP are 20% more likely to follow treatment regimes carefully.

Consumer-Driven Health Saving Plans

Consumer-driven health plans give employees with high-deductible plans more control over their health care expenses and more responsibility for their health care decisions. According to economist John C. Goodman, "In the consumer-driven model, consumers occupy the primary decision-making role regarding the health care they receive." Goodman points to a McKinsey study that found patients with a consumer-driven health plan were twice as likely as patients in traditional plans to ask about cost and three times as likely to choose a less-expensive treatment option, and chronic patients were 20% more likely to follow treatment regimes carefully.

ISM and The Harrison Group have partnered to offer private-independent schools the three most popular consumer-driven health plans—Health Saving Accounts (HSAs), Health Reimbursement Arrangements (HRAs), and Flexible Saving Accounts (FSAs/125 Plans).

HSA

  • 16.5 million Americans currently in HSAs—an annual 22.5% growth rate
  • U.S. banks held $15.9 billion in HSA deposits at the end of 2012
  • 38% of employers offered an High Deductible Health Plan (HDHP) with an HSA in 2011
  • Nearly two-thirds of employers will offer an HDHP with an HSA in 2013

HRA

  • HRAs were offered by 25% of companies in 2012
  • Enrollment in high-deductible plans with HRAs increased from 34.2% to 37.9% in 2011
  • When employees have a choice between consumer-driven health plans and another medical plan, enrollment averages 31% for HRA-based plans and 21% for HSA-based plans.

FSA—Largest Market

  • Over 85% of large employers offer FSAs, but only 20%–22% of eligible employees enroll
  • FSA enrollees make an average election of $1,400, resulting in a net tax reduction of about $200 and $75 forfeited per year

How They Work Together

FSA HRA HSA
FSA Employer decides what gets paid first FSA cannot pay until deductible is met—only pays dental and vision claims
HRA Employer decides what pays first HRA cannot pay until deductible is met—only pays dental and vision claims
HSA FSA cannot pay until deductible is met—only pays dental and vision claims HRA cannot pay until deductible is met—only pays dental and vision claims

If you have an FSA, you can have an HRA but must decide if the FSA or the HRA pays first.

If you have an FSA or an HRA, you cannot have an HSA unless the FSA only pays for dental and vision expenses or pays after the HSA deductible.

For more information about offering Consumer-Driven Health Plans with your schools health plan, contact Linda Geist at 302-656-4944 or linda@isminc.com.

To enroll online click here.

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