The Berkeley Electronic Press has published a major contribution to the literature about consumer-directed health plans (CDHPs). The paper, “How Do Consumer-Directed Health Plans Affect Vulnerable Populations?” by Amelia Haviland, Neeraj Sood, Roland McDevitt, and Susan Marquis is one of the most rigorous I’ve seen on the topic.
It examines claims data from 59 large employers, most of which installed some form of CDHP in the 2003 to 2007 time period. It does some things that are unusual in the universe of CDHP studies. First, it looks at other similar work and explains why other studies may vary from the conclusions in this paper. Next, it breaks the CDHP plans into moderate and high deductibles with a Health Reimbursement Arrangement, Health Savings Account (HSA), or into no account. Thus, it has five different categories of plans to compare. Finally, it looks closely at the use of preventative services, but unlike many other studies it is very specific about what it means by the term, confining it to three cancer screening tests and three tests for diabetes.
The authors were motivated to do the study in the expectation that health reform (ObamaCare) will result in major new enrollment in CDHPs, both in the individual health insurance exchange market and in the employer-based market. They also expect state Medicaid programs to rely on similar designs in expanding their Medicaid programs. They wanted to test whether low-income and high-risk populations would be disadvantaged in such a system.
What they find is fascinating.
First, they confirm that CDHPs have a very large effect on health care costs:
Total spending is reduced in high deductible health plans for both vulnerable and non-vulnerable families. High deductible plans paired with HSAs have significantly lower levels of total spending than other high deductible plans for the general population — almost 30 percent lower spending for families with a high deductible and an HSA…
This holds true for all categories of spending: inpatient, outpatient, and prescription drugs.
They also find that “vulnerable families” (low-income and/or high-risk) are not disadvantaged by the spending reductions:
There are no statistically significant differences between non-vulnerable families and low-income or high-risk families in terms of dollar reductions in total spending that result from benefit designs and few differences in the components of spending. However, since high-risk families have higher levels of spending, the proportional reductions in total annual spending are generally smaller for those at high risk.
The authors were particularly concerned about whether vulnerable families would fail to receive recommended preventive care services. They found:
As with spending, there are few significant differences between low income and non-vulnerable families regarding the effect of plan design on receipt of the cancer screening. However, there are significant differences for those at high risk. For them, a high deductible is not associated with reductions in receipt of two of the three recommended procedures and the reduction for the third is significantly less than for the non-vulnerable population, though this latter is not significant when we adjust for multiple comparisons.
In other words, people at high risk are not deterred by the plan design from getting needed screening.
The authors still have some concerns. They write:
Although health care spending is lower for those in high deductible plans, the evidence suggests that non-vulnerable families, low- income families, and high-risk families are equally affected. However, equal effects with respect to health care spending may have different consequences for these populations.
So it is possible that similar reductions in the use of services may have disproportionate effects on some segments of the population, but the authors say that that issue is beyond the scope of this study.
They go on to acknowledge other limitations of this research. For instance, this study looked only at one year before enrollment and one year after. It is possible (as we have been arguing) that once people are more involved in and educated about their choices, they will become better at choosing appropriate services. The authors say:
…our analysis examined people in the first year of their enrollment in CDHPs, and they may not yet be familiar with the details of coverage. One encouraging finding on this front is that the deductible was less of a deterrent to receipt of preventive care for high-risk patients, who might be more engaged with medical providers and more familiar with the terms of their insurance.
Indeed, the use of patient support services, wellness programs, and employee education are not examined here at all, which is a pity because the 59 employers surely had very different approaches to these services. The authors write:
This highlights the need for additional research to explore whether more aggressive case management, educational approaches, or other programs would help ensure that patients eliminate unnecessary care and continue with appropriate treatment under CDHPs.
They conclude by saying:
In sum, our findings suggest that CDHPs reduce spending without unduly restricting access for lower income and chronically ill populations. However, in all groups, there is evidence of a small reduction in receipt of high value preventive procedures. Further research is needed to address whether these findings also apply after the first year of experience in a CDHP. This additional research should evaluate whether the reductions in health care spending for vulnerable populations have greater health or financial consequences for them than for others.
My Conclusion. This is excellent research. I have long complained that the so-called “research community” was missing an opportunity by ignoring the empirical experiment taking place under their noses. That has left the field open for political hacks who try to exploit the little bit of available data to advance an agenda.
We who advocate for consumer empowerment in health care have nothing to fear from credible research — quite the opposite. We need to know what works and what doesn’t, so it can be revised and improved. We don’t need to trick politicians into supporting our ideas, if the ideas are flawed. That helps no one. But the only way to reliably test the ideas is in the market place under real world conditions. That is what Haviland and colleagues have done here, and for that I am grateful.