A return to double-digit annual growth in health benefit costs is fueling interest in new structures for employment-based health benefits. The new plans are still works in progress and theres not even agreement yet on what these plans should be called: Some of them are called "consumer driven" because of the hope that individual consumer choices will help contain health care costs. Others call them "defined contribution" because they could create a situation where sponsors that establish and limit their contribution to the benefit can cause workers to take responsibility for using this fixed amount for health coverage provided by the employer.
The basic goal is to control cost increases by delegating more direct responsibility to consumers (and beneficiaries) of health insurance. Advocates say such plans could reduce consumer resentment caused by the restrictions common to managed care plans. Critics say the plans-by whatever name they are called-will only shift health care costs away from the employer and onto the worker.
Historically, employers have played a crucial role in determining how the health insurance system operates in this country. For decades, employers have known that using a limited number of carefully selected health-care providers, and changing protocols for providing health care services, can cap costs-although using that knowledge has proven difficult. This insight fueled the growth of managed care plans. The decline of "traditional" indemnity health insurance over the last decade is a direct result of this employer response to sharp increases in health coverage costs.
Now that health care and health benefit costs are soaring again, employers are looking once more for new ways to provide health benefits that are affordable, palatable and medically adequate for beneficiaries, and sustainable for both employers and their workers. Whatever the potential ancillary benefits of these plans may be, cutting costs is clearly the driving force and top priority.
About a hundred leaders of the health sector, policymakers, employers, labor representatives, and others examined some of the deeper implications of greater cost sharing generally, and consumer-driven models in particular, during the Employee Benefit Research Institutes May 2, 2002, policy forum on Consumer-Driven Health Benefits: A Continuing Evolution? The papers contained in this book, based on the policy forums proceedings, explore in detail the research that has been done on consumer-driven health benefits, how health insurance coverage is changing in the United States in an effort to perfect managed care, and the implications for consumers, business, and government.
Consumer-Driven Health Benefits: A Continuing Evolution? provides a comprehensive review of where this issue has come from and how it is likely to change the American health benefits system.