Recent studies conducted by two of the largest U.S.-based health insurers indicate that employers sponsoring consumer-directed health plans have been substantially more successful in controlling medical costs than traditional HMO and PPO plans over the past several years.
Employees and dependents enrolled in one of Bloomfield, Conn.-based Cigna Corp.’s “Choice Fund” CDHPs reported an average 7% decrease in medical costs during their first year of enrollment, compared with an average 7% one-year increase among HMO and PPO enrollees, according to Cigna’s seventh annual Choice Fund Experience Study.
Cigna’s study, released last week, examined claim experiences among 1,900 client group plans covering more than 2.5 million individuals. Overall, Cigna said combined enrollment in its Health Reimbursement Arrangement and Health Savings Account CDHP programs grew by 26% in 2012.
Thousands in savings
Cumulatively, Cigna’s group CDHP clients saved approximately $1,300 per employee in the first year, the study found. Per-employee savings compounded among CDHP clients in each subsequent plan year, totaling $7,800 by the fifth year.
In a statement accompanying the study, Cigna President and CEO David Cordani said the lower medical costs reported by CDHP enrollees are attributable in part to that group’s higher rate of participation in health and disease management programs, as well as more frequent use of online pricing and quality-of-care rating indices.
Thirty-one percent of CDHP enrollees completed a health risk assessment in 2012, compared with 15% of HMO and PPO enrollees. Almost three-quarters of CDHP participants registered to use Cigna’s online health care pricing directories and decision-making tools, compared with 47% of HMO and PPO plan members.
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