Consumer Directed Health Plans
Health Affairs is out with a new article looking at the growth of Consumer Directed Health Plans (CDHPs) and their future potential. CDHPs have increased their market share every year since their inception with over 11 million customer in January of 2011. In 2006, CDHP’s only made up 4 percent of the employer sponsored insurance market, but by 2010 that amount had increased to 13 percent.
If their popularity continues to grow the nation could see significant benefits. Health Affairs estimates that if CDHPs made up 50 percent of the employer sponsored marketplace the nation would save $57.1 billion annually on health care spending.
The concept is a simple one. Individuals with CDHPs are required to pay for “first dollar coverage”. First dollar coverage is the upfront costs of health care such as preventative services, check-ups, etc. By giving patients skin in the game they become consumers measuring their health on cost and quality as well as quantity. In health care policy, the name of the game is bending the cost curve and CDHPs do just that.