Why High Deductible Health Plans with Employer and Employee HSA Funding Can Drive Change in Employee Behavior.
Why High Deductible Health plans with employer and employee HSA funding can drive change in employee behavior and why it is our (brokers/advisors) responsibility to education, position, recommend and implement these types of plans with our employer clients.
December 2003 was a great day for health plans in America. This was the date that High Deductible Health plans and the underlying Health Savings Accounts were enacted into law by the federal government.
With this law we were provided the ability to engage employees more directly in the cost of their care with the elimination of copays and RX cards under these plans.
What many brokers don’t realize is that the law allows anyone to fund the underlying Health Savings Accounts. This means that employers (can and should) be shown how to use the savings in premiums created by moving to these types of plans to “fund” employee’s Health Savings Accounts. This can result in a “win/win” for all.
When employers fund the employee’s HSA they provide the employee the ability to direct additional money into a Flex spending type of plan (HSA) that has much higher limits for funding, and allows the same expenses to be reimbursed along with long term care premiums, Cobra premiums and Medicare B expenses. These accounts don’t have the “use it lose it” risk that Flex medical reimbursement plans have always included.
Now what we need is transparency data from the hospitals and providers. It is my belief that if every American was required to have a High Deductible Health Plan paired with a Health Savings Account only, the demand for transparency data would be palpable and the pressure forced on providers and hospitals to comply would amplify.
Right now the transparency data is not available and this needs to change. If the only plan employers could offer were HDHP plans with HSA accounts and if employers provided funding to help their employees be able to afford the additional exposure shifted to them, the demand for transparency data would suddenly become top priority and the government would demand it of providers.
Yes they are more complicated to understand and yes the programs require more employee education and hand holding…..Nothing good happens when we sit on the sidelines…Let’s commit to become part of the solution!