A GAO Report (pdf) just found that workers enrolled in the Federal Employee Health Benefits Program's consumer-directed plans are more satisfied than anyone save PPR members. A real feather in the cap of the consumer directed health care (CDHC) movement? I wish. The plan offered to postal workers is a perfect example of the sort of CDHC that I've long been on record supporting:
Administered by Definity Health Plan, the APWU CDHP is a high-deductible PPO plan coupled with an HRA. The deductibles are currently $1,800 for an individual plan and $3,600 for a family plan. For an individual plan, the first $1,200 of the deductible is paid for from the HRA—which is funded every year by the enrollee's employing federal agency. The remaining $600 of the deductible is considered the member's responsibility. Unused balances may accumulate and roll over from year to year up to a maximum of $5,000 for an individual plan and $10,000 for a family plan. The member responsibility is paid by the employee, either out of pocket or from accumulated balances in the HRA from prior years.16 Once the deductible has been met and the HRA is exhausted, the plan generally pays 85 percent of the cost of covered services.17
The HRA may be used to pay for two types of services: basic expenses, such as doctor visits and hospital charges, and “extra” expenses, such as certain preventive care services that are not covered by the plan.18 The HRA coverage of extra expenses does not count toward the deductible. For example, if an enrollee exhausts the HRA by spending $1,200 on basic physician office visit expenses, and then spends another $600 out of pocket for extra preventive care services, the enrollee would need to spend another $600 out of pocket on basic expenses before the $1,800 deductible is met and the plan begins paying 85 percent of expenses.
The APWU plan is what's called an HRA. Unlike HSA's, which shift costs onto the employee by simply offering them a tax-advantaged savings account, HRA's are still funded by employers, they're just structured so as to encourage more consumer involvement, information, and participation. Since preventive services are covered outside the deductible and basic services (doctor's visits, etc) are taken care of by the employer's up-front contribution, little necessary care is skipped, but moral hazard concerns remain addressed. Would that the rest of the CDHC movement adopted the HRA structure, which actually accomplishes their goals, rather than the HSA structure, which simply shifts costs onto employees and ensures Republicans continue receiving hefty contributions from pleased corporations.
