WHAT DO HIGH-DEDUCTIBLE HEALTH PLANS LOOK LIKE?
September 20, 2005
Using data from the 2005 survey of employer health benefits, researchers documented the availability, enrollment, premiums and cost sharing for high-deductible health plans offered with a health reimbursement arrangement (HRA) or health savings account (HSA) qualified plans.
According to a new study by the Henry J. Kaiser Family Foundation and the Health Research and Educational Trust:
- Almost 4 percent of employers with health plans offered one of these arrangements in 2005, covering about 2.4 million workers.
- Participation rates for these new arrangements (25 percent of eligible workers for HRAs and 15 percent for HSAs) seem reasonable, given how recently these plans have come onto the market and how complicated they are.
- Deductibles, as expected, are relatively high for both single and family coverage, with HRAs averaging $1,870 for single and $3,686 for family coverage and HSAs averaging $1,901 for single and $4,070 for family coverage.
- One in three employers offering an HSA qualified plan does not contribute to HSAs established by its workers; for those employers who do contribute, their contributions are, on average, much lower than the deductible amounts, which leaves enrollees with meaningful out-of-pocket risk.
Many observers expect these new arrangements to grow during the next few years. One explanation for the relatively low offer rate of HSA qualified plans is that although they were authorized in 2003, the Treasury Department did not issue regulations for the implementation of HSAs until summer 2004.
In addition, large employers (1,000 or more workers), which employ more than half of U.S. workers with health insurance, have a higher offer rate and report stronger interest in these new plans than firms overall. These employers could provide a strong base for future enrollment growth.
Source: Gary Claxton, et al, "What High-Deductible Plans Look Like: Findings from a National Survey of Employers, 2005," Health Affairs, September 14, 2005.
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