Consumer-driven Plans in Action: Costs Down 26%

Posted by Greg Scandlen in HSAs on Feb 9th, 2010 | one response

Cigna has released the latest of its reports on the experience of its consumer-driven health plans. It issued a press release saying, “As overall medical costs continue to increase by double digits annually, medical costs for individuals in account-based consumer-driven health plans (CDHPs) went down 26% over four years.” And it adds that this happened, “while levels of care for their preventive medicine, chronic disease management and evidence-based treatments were higher than their counterparts in traditional PPO and HMO health plans.”

More specifically the study of 655,000 Cigna enrollees found:

Immediate and sustainable cost savings: CDHP medical costs are 14% less than traditional plans the first year, cumulative cost savings rise to 19% in the second year, 23% in the third year and 26% in the fourth year.

Higher levels of care: People with CIGNA Choice Fund received recommended care at compliance rates that were similar to or better than those covered by traditional CIGNA health plans. Key indicators such as use of preventive care, evidence-based care, and disease management program participation were measurably better among those in CIGNA CDHPs than those in PPOs and HMOs.

Less cost for those with chronic conditions: Medical cost trend was substantially less for CIGNA Choice Fund customers with hypertension (27% less), joint disease (21% less), and diabetes (15% less) than for individuals with either of those diseases in traditional CIGNA health plans. According to the study data, these cost savings were achieved without sacrificing care.

The press release quotes Chris Policinski, president and CEO of Land O’Lakes, Inc., as saying, “Offering consumer-driven health plans to Land O’Lakes employees is helping to keep health care costs in check, while maintaining or improving care quality. For Land O’Lakes, this approach supports our commitment to employees, while at the same time ensuring that we remain highly cost efficient.” Eight out of ten workers at Land O’Lakes are choosing the CDH plan over traditional managed care plans.