Due to the rising cost of health care and new regulations, employers offering health insurance find it difficult to control costs. Although they want to provide high quality health plans, it is difficult to keep the cost of these plans affordable. Many employees do not understand the true cost of health care and have no incentive to cut costs. For this reason, many employers transfer part of the responsibility and risk for health care to their employees. This is where consumer-oriented health plans come in.
Consumer-focused health plans, also called CDHP, are health care plans that allow consumers to better control where and how their health care spending is spent. They generally consist of three parts. The first element of a consumer-oriented health plan is a high deductible. It provides financial security in the event of serious illness, while preventive care services are generally provided at low cost. The second element is a health fund where employees and employers can contribute. The insured can use the funds for health services before the deductible is respected. Finally, consumer-focused health plans provide information tools to help the insured make better health care choices.
Although consumer-oriented health plans are structured differently from traditional health plans, they work essentially the same way. The insured must satisfy his deductible. In order to meet the deductible, the insured pays a negotiated price for each medical service until it reaches the designated amount. The insured can also use the funds in their health care account to help pay for services until the deductible is reached. Once the deductible is satisfied, the insurance company and the insured will share part of the cost of the medical services covered. The insured and the insurance company will continue to share the costs of medical services until they reach their pocket. Once the insured has reached their maximum, the plan will pay all costs for medical services for the rest of the year.
Although consumer-focused health plans are new medical plans, many employers choose to offer these plans to their employees. They allow employers to still offer quality health care plans, but at a fraction of the cost. They also help employees participate in their health care and take responsibility for their health. No matter what opinions people may have about them, it seems that consumer-focused health plans are here to stay.