Membership in high-deductible health plans remains on the upswing

Experts are concerned that enrollees don't understand the limitations of their coverage.

By Emily Berry — Posted June 27, 2011

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Enrollment in high-deductible health plans paired with health savings accounts continued to grow between January 2010 and January 2011, from 10 million to 11.4 million members, according to the most recent census by health insurance trade group America's Health Insurance Plans.

The continued growth in high-deductible plans, which tend to have lower premiums but limited benefits, came from both employer-sponsored enrollment and individuals, although group coverage continued to account for most of the population and grew more quickly. Between 2010 and 2011, group enrollment increased from 8 million to 9.1 million and individual enrollment from 2.1 million to 2.4 million, according to AHIP's report, which was released June 14.

Generally, members are covered only after a deductible of $1,000 or more is met, and they must use a pre-tax health savings account for day-to-day health expenses.

Dennis Triplett, CEO of UMB Healthcare Services, a division of UMB Financial, a Kansas City, Mo.-based bank that holds thousands of HSAs, said the company saw rapid growth between the 2009 and 2010 open enrollment periods. He said UMB had a 40% increase in the number of accounts and a 46.8% increase in the total balance in those accounts, to more than $279 million.

"These plans give employees some 'skin in the game' and an incentive to not only better manage their health but also to be a more educated consumer," he said in a prepared statement.

But recent research has shown that enrollees in high-deductible plans tend to use less preventive care and that some people don't understand their coverage.

A RAND Corp. study released in March found that people with high-deductible plans saved money during the first year they were enrolled, but mostly because they received less preventive care. This was puzzling to researchers, because many high-deductible plans cover at least one annual preventive visit with no out-of-pocket cost.

Experts say employers and health plans need to make sure they do a good job explaining coverage to their employees and members.

AHIP, meanwhile, called on the government to protect high-deductible plans and HSAs on the grounds that so many people have chosen them. The group is worried that the Patient Protection and Affordable Care Act will threaten the business because health plans will face medical spending minimums.

Other statistics from AHIP's report:

  • Minnesota, at 14.9%, had the highest percentage of enrollment in high-deductible plans paired with an HSA of any state. The percentage covers those younger than 65 who have private insurance. Following Minnesota were Vermont, 11.4%; Colorado, 11.3%; Montana, 10.8%; and Ohio and Indiana, each at 10.6%.
  • Hawaii had the lowest percentage of enrollment in HSAs paired with a high-deductible plan -- 0.2% -- among those younger than 65 with private insurance. Following Hawaii were West Virginia, 2.1%; Mississippi, 2.4%; New Mexico, 2.6%; and Massachusetts, 2.7%.
  • California had the greatest number of enrollees of any state, with 1,073,319. It was followed by Texas, 844,832; Ohio, 728,868; Illinois, 690,509; and Florida, 656,243.
  • Preferred provider organizations, at 92%, were by far the most popular health plan type to be paired with an HSA.
  • The age group 0-19 had the highest percentage of insured covered by HSAs, at 26%. Most were enrollees covered under family plans. The second-highest percentage were those ages 50-59, at 21%. The lowest percentage were those 60 and older, 9%. Those ages 20-29 and 30-39 each were at 13%, and those 40-49 were at 19%.

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External links

"January 2011 Census Shows 11.4 Million People Covered by Health Savings Account/High-Deductible Health Plans (HSA/HDHPs)," America's Health Insurance Plans, June (link)

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