Point /Counter point: Consumer Directed Health Plans

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  • September 1, 2008
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Payer side: Consumers Take Control

By Julia Croly, CPC
During open enrollment, your employer may offer insurance options that include a consumer-driven health plan (CDHP). Selecting insurance can be confusing enough without adding another option to research. Glossy marketing material depicts “choice” and “simplicity;” however, to the average consumer the choice doesn’t feel simple. Why does a CDHP seem so complicated and is it right for you?
A CDHP offers incentives and resources for consumers to help make choices about their health care coverage. These plans empower consumers to better understand their health care dollar spending by aligning health care decisions with personal finances. Certified coding consumers, possess billing knowledge giving them an advantage when considering this insurance option.
CDHPs were introduced in 2000. There are a many factors prompting CDHPs and consumer-oriented tools including the need for reduced costs, a declining percentage of employers offering health insurance coverage, and an employment environment where job change is frequent.
CDHPs can be described along a continuum of health care plans with varying degrees of employer/employee responsibility. There are two components to the CDHP: the high deductible health insurance plan (HDHP) and the health savings account (HSA) or health reimbursement account (HRA). To ensure maximum consumer benefit the two components are paired together. An HSA is a tax-free savings account for the consumer to set aside money for future medical care. The HDHP comes with lower monthly premium payments, and it is presumed the consumer will put the money he or she saves with lower premiums into the HSA. The idea behind the HDHP and the HSA is to put consumers in charge of how their health dollars are spent.
HDHPs provide comprehensive coverage when an individual meets an annual deductible. Providers, provider discounts, and covered services are often the same as what other plans offer. Co-pays are not a part of HDHPs, as consumers pay their own claims until the deductible is met. Since consumers pay their claims while benefiting from the plans’ discounts, they become keenly aware of the cost of services and treatment options. In exchange, premiums are lower than traditional preferred provider organization (PPO) plans.
With most HSA plans the unused amounts can be rolled over from year to year, so consumers have the incentive to spend more carefully when seeking health care service and treatment.

HDHP Success at Your Fingertips

The key to HDHP success is using the readily accessible information about health services and pricing. Our coding knowledge is a great first step. The internet allows consumers easy access to a wealth of medical information. Many health plans offer cost comparison tools for their members. As a consumer and certified coder, we have an advantage in understanding services rendered and pricing. How many times do certified coders go to the physicians’ office and based on coding knowledge mentally code the office visit as a 99213 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: An expanded problem focused history; An expanded problem focused examination; Medical decision making of low complexity. Rather than a 99214 Office or other outpatient visit for the evaluation and management of an established patient, which requires at least two of these three key components: A detailed history; A detailed examination; Medical decision making of moderate complexity, as coded by the physician? When we have some skin in the game (we are paying for the visit out of pocket), the temptation to challenge the coding is greater to have the coding accurately reflect the services rendered and save money, as the reimbursement for a 99213 is often less than a 99214.
There are many factors to take into account when selecting health insurance. Certified coders have additional knowledge when it comes to understanding health care options. The old adage “knowledge is power” applies to certified coders and their ability to effectively navigate a CDHP.

Provider side: Consumers Shoulder the Financial Load

By Kevin B. Shields, CCS, CPC, CCS-P, CPC-H, CPC-P, RCC, CCP-P
Many have seen the television commercial where a “patient” is walked through an abdominal surgery via telephone “consult” with his provider. That caricature of health care depicts how consumer-driven health care will pit the patient, diagnosis, cost, and therapy against one another. Eventually, patients may find themselves asking, “Appendectomy or 401K?”
CDHPs grow increasingly popular among employers each year; however, despite HSA’s popularity, the idea that competition and consumerism can act as cost-containment tools remains to be established in practice.
The concept of HSA’s improved quality and reduced spending rests on several basic assumptions. Primary to these is that patients take personal accountability in health choices when made to principally fund those decisions. Shifting risk and cost from corporation to individual fails to account for “low income” employees and with the higher risk, comes increased affects from market changes, unexpected events, and local availability of service. There is insufficient evidence to support patients receiving better care from HSAs by absorbing greater personal expense. After all, the majority of care and services are ordered by physicians based on clinical determination, not patient decision.
Another unreliable feature of CDHPs is the substantial transparency not present in current reimbursement schemes. To the advocates of CDHPs, try explaining the E/M determinants to a patient. It’s improbable for patients with limited understanding of health care and varying qualifications to appropriately determine expenses and necessary treatment while scrutinizing quality. HSAs support the expansion of primary care practices  while insisting the cost of service will decline; in actuality, the inflation growth could encourage competition between primary care and the urgent care style clinics. Other administrative concerns for practices should be work burden migration within the revenue cycle. While many tasks can be carried out after the patient encounter, the HSA and consumer plans require more work prior to when the patient is seen. Frequently, patients are required to carry increased administrative weight by submitting receipts, tracking explanation of benefits (EOBs), and determining deductible costs themselves.

Shoddy Treatment to Save a Buck

Although marketing frequently cites improved therapeutic outcomes, the plans’ cost-prohibiting nature could force patients into less studied or less effective means of treatment because they are more affordable. The avoidance of care by ill, financially strapped patients may result in an uninsured increase and an increase in per capita health care costs. Studies have shown that more than half of the patients with CDHPs admit to permitting cost of services which restricts the likelihood of receiving that service.
Our shrinking American middle class may be forced into buying “generic” health care to supplant the growing fiscal responsibility high-deductible plans entail. Payers and employers benefit from these plans at the expense of employees and beneficiaries. Simply, we shoulder the cost, administrative responsibility, and suffer the consequences of risky medical care of a shoddy insurance product.

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