By Mary Agnes Carey, CQ HealthBeat Associate Editor
October 24, 2006 -- Consumer-directed health plans might help curtail overuse of health care services and reduce health costs, but they also might deter consumers from getting the care they need, according to a RAND Corporation study released Tuesday.
"We know people are going to reduce their use of health care under these plans," the study's lead author, Melinda Beeuwkes Buntin, said in a statement. "But what we don't know is how this will affect overall health care quality and patients' health."
Consumer-directed health plans are often paired with health savings accounts (HSAs), which were created in the 2003 Medicare overhaul law (PL 108-173). HSAs allow individuals who sign up for high-deductible health plans to contribute and withdraw funds to cover health care costs tax-free.
Proponents of the plans say the accounts will make consumers more cost-conscious and they will begin to comparison shop and request quality data, eventually driving down health care costs. But opponents say HSAs will attract healthy young people and wealthy Americans who use fewer health care services, leaving traditional plans with more costly enrollees who drive up premiums.
According to the RAND study, last year 10 percent of privately insured, nonelderly American adults were enrolled in a consumer-directed plan. Of those, only 10 percent had an HSA.
But interest in HSAs is growing as both elected officials and employers look for ways to control rising health care costs. More than 3 million people are covered by HSAs, according to America's Health Insurance Plans (AHIP), a trade group representing health care insurers.
HSAs are one of several choices AHIP plans offer to consumers, said AHIP spokesman Mohit Ghose. "They are suitable for some people, but not suitable for others," he said. "We also must note, as do the RAND researchers in their own summary, that the evidence needed to draw firm conclusions about [consumer-directed health care's] overall effects does not yet exist."
Grace-Marie Turner, president of the Galen Institute, a conservative Alexandria, Va.–based research group that promotes free-market health care ideas, said some of the concerns pointed out in the RAND study exist in many other insurance plans as well.
"Basically, they're saying that people aren't getting preventative care and they're not taking their meds. Well, people don't take their meds and don't get their prescriptions filled when they have traditional plans, and I don't see anywhere that they compared the two of those," Turner said. "Basically, they're saying the jury's out, we don't know if people are going to do any better or worse as far as health outcomes" in consumer-directed health care plans.
The RAND researchers estimate that if all privately insured, nonelderly Americans were moved from low-deductible health insurance plans to consumer-directed plans, the result would be a one-time health care cost reduction of 4 percent to 15 percent. But they also noted that pairing such high-deductible plans with HSAs could offset those reductions by as much as half.
The RAND analysis, published Tuesday on the Web site of the journal Health Affairs, said early results suggest that when people pay more out of pocket for health care, they tend to spend less on what could be called "inappropriate" care, such as demanding an antibiotic for a viral infection or going to the emergency room for a non-urgent health problem.
What is not known, the researchers note, is whether consumer-directed health plans will deter people from getting the health care they really need. For example, some consumer-directed plans waive or reduce the deductible for preventive care and often provided financial incentives for consumers to enroll in disease management and other "wellness" programs.
Other conclusions of the study—a review of existing research on the accounts—include that individuals enrolled in consumer-directed plans tend to have higher incomes and be in better health and that consumers are struggling to find reliable information on the quality and price of health care.
The RAND report is part of a four-year, $4 million study co-sponsored by the California HealthCare Foundation and the Robert Wood Johnson Foundation to examine the effect of high-deductible health plans—with and without spending accounts—on areas such as use and quality of care, health status, income, and other factors.