A Role for Consumer-Directed Plans in Achieving Universal Health Coverage

Over on the Market to Market blog today, Mark Reiboldt posted a summary of the event he chaired today on behalf of the Technology Association of Georgia, which explored the impact of the financial crisis on the healthcare industry.

Mark wrote in his blog that he posed a question to the panel them asking whether or not consumer-driven healthcare (CDH) will be†relevant under a universal model, as proposed by Barack Obama, Hillary Clinton and most Democrats in Washington.

Mark writes that Dr. Bill Custer, who is a healthcare economist at Georgia State University’s Health Policy Center responded by saying that CDH will be relevant; however, not in the way that we have seen it thus far.† Mark writes that Custer more or less argued that Health Savings Accounts and other products of the consumer-driven healthcare movement will likely not emerge as a competitive product or have a significant role in the model that is likely to emerge in the near future.

I disagree with Custer’s assessment of the role that CDH and Health Savings Accounts can play in achieving universal coverage. In comments I left on the Market to Market blog, I noted that as an executive with a national HSA administrator, I am seeing a very large number of HSA accounts being opened this January, so the rate of adoption seems to be picking up. I think these types of plans will continue to be relevant as we try to move toward universal coverage and while we continue to struggle to bring down costs.

As long as employers are involved in paying the bill, they will continue to look for ways to engage employees in helping to control the costs. This is the major premise behind consumer-driven health plans.

If, on the other hand, an individual mandate is the route taken, most individuals will no doubt be looking for the best coverage at the lowest cost – the way they do today with auto insurance. Where we seek a balance between what we are willing to self-insure (deductible) and what we want covered (catastrophic).

I think the future can be good for these types of plans as we work toward universal coverage, and I still believe that the competitive market forces that consumerism brings is the fastest way to make the health care system more efficient and effective.

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