Communications are key when starting a Health Savings Account or Health Reimbursement Account
Employers’ experience in implementing consumer-directed health plans (CDHPs)-typically a high-deductible health plan in tandem with either a health savings account (HSA) or health reimbursement account (HRA)-shows that enrollment figures can be very different from one company to the next. However, when workers have a choice of health plans in addition to a CDHP, such as a preferred provider organization (PPO), health maintenance organization (HMO) or point-of-service (POS) plan, enrollment in these other plan options typically far outstrips that in the CDHP. A survey from the Kaiser Family Foundation found that when given a choice among these four different types of plans, only 19% of employees opted to enroll in a CDHP, compared with 55% in a PPO, 40% in an HMO and 34% in a POS plan.
A survey from Segal/Sibson of companies that had implemented CDHPs found that communications play a vital role in the success of a consumer-directed health plan. This is especially so, the survey report states, because employees tend to be skeptical of the CDHP option when it is first introduced. Almost three-quarters of the surveyed employers that had implemented a CDHP said they had invested more resources in educating employees about the CDHP option than they had in communicating other changes in benefits.
A separate study from Watson Wyatt and the RAND Corporation underscores the importance of communications in successful CDHP implementation. When employees have a choice of health plans, this study states, “employers must try to explain the rationale for and design of the CDHP in a fashion that communicates the CDHP’s underlying value and encourages employees to sign up.” Furthermore, “to get the most out of these plans, employees need reliable and extensive health care cost and quality information so they can make good health care decisions.”
Thus, CDHP communications really must be multi-faceted, and go beyond “about-the-plan” messages to include information that will enable employees to be smart health care consumers. Given this task, it’s no surprise that 90% of the employers in the Watson Wyatt/RAND study cited employee communications as their biggest challenge in CDHP implementation.
Topics to Consider When Implementing Communication Materials
In developing CDHP communications, it’s important to remember where employees currently are in their understanding of and experience with health plans. For most employees, CDHPs represent a whole new way to finance health care, and many will see the prospect of the high deductible as very risky. Thus, it’s essential that communications clearly outline how CDHPs work-for example (if applicable), that the premium will be lower, that the underlying health plan operates in tandem with an HRA or HSA to which the employer has made a contribution, and that these accounts can accumulate and offset the impact of the high deductible in the event that the employee or family needs the type of care that is subject to the deductible (e.g., care other than preventive care).
In the Watson Wyatt/RAND survey, more than half of the employers involved employees in creating plan communications materials, and on average began communicating to employees about the new plan more than four months before open enrollment. Many of the employers surveyed emphasized the importance of including specific and realistic examples of how an employee’s out-of-pocket costs under the plan might play out over the course of a year (e.g., showing what the plan would pay depending if an expense was for preventive care or regular medical care, and how the HSA or HRA could be used).
Consumerism messaging as part of CDHP communications
Consumerism messages should endeavor to help employees understand that how they obtain health care can significantly affect their costs over time. Such messages include the importance of regularly obtaining recommended preventive care; tending to and staying on top of any chronic medical conditions; understanding the reasons behind any treatments a doctor recommends; and choosing reliable lower-cost treatments-such as generic prescription drugs-when available.
Consumer-oriented messages must be an ongoing staple of CDHP communications, repeated in various media and restated through a variety of examples. As employees gain familiarity with the way CDHPs work, these long-term communications messages will eclipse the “how the plan works” messages in frequency. If these messages work as intended, employees will grow into more engaged health care consumers, savings both themselves-and their employers-dollars on their health care spending.