Spring 2006 / No. 67
Innovation in consumer-driven health
plans
We, at Eastbridge,
have watched with interest the movement towards consumer-driven
health plans. As regular readers of Outside Input know,
we have done two reports on Health Savings Accounts with special
emphasis on how voluntary carriers are responding to this product.
To date, we’ve found that many carriers have developed
or revamped their hospital indemnity plans to make them “HSA-compliant.” One
carrier (that offers HSAs) has also recently introduced an
innovative product approach to a common concern about HSAs:
what to do in the early years when the account balances are
low.
Many employees
are reluctant to take advantage of high deductible health plans
(HDHP) with HSAs because they’re concerned about not
having the cash available to pay their deductibles in the event
of a catastrophic event in the early years. To help remedy
this, the one carrier developed a hospital indemnity rider
that is available with HSA plans at the initial application.
What makes this plan unique is the benefit structure and the
one-time premium payment. The benefit is based on the covered
employee’s deductible amount, and the amount paid decreases
over a period of up to two years. So, if the employee has a
serious illness or accident within months of implementing an
HSA plan with this rider, the rider pays a benefit that covers
a significant portion of the deductible on their HDHP.
We don’t
know how the plan is fairing, but we like the innovation and
hope that other companies will be challenged to come up with
creative solutions for helping employers and employees address
health care concerns and costs.
For
information on the latest HSA spotlight report, go to our
website or give us a call. |
