Consumer-Directed H.C.

Key Questions (by Greg Van Winkle)

What Is Consumer-Directed Health Care?

There are many good sources describing and explaining what exactly is meant by the term “consumer-directed health care.” The best starting place for an introduction to consumer-directed health care and the policy decisions surrounding it is an article by John C. Goodman, a leading expert in the field, called What is Consumer-Directed Health Care? Comparing Patient Power with other Decision Mechanisms. Gary Claxton from KaiserEdu also gives an excellent explanation of consumer-directed health care in an audiocast tutorial that goes a little more in depth. If webcasts are what you are looking for, Fox News Interactive and Health Politics with Mike Magee each have short videocasts that address the topic. In addition to the tutorial, KaiserEdu also has a background brief that gives the broad definition of consumer-directed health care, but the first two sources are better if you really want to explore CDHC. RAND offers a longer discussion of what CDHC is, and also branches out into many of the other issues surrounding consumer-driven healthcare. Consumer Driven Health Benefits: A Continuing Evolution? by the Employee Benefit Research Institute also provides a more in depth discussion of the topic as a whole.

Why Is There Movement Towards Consumer-Directed Health Care?

There are many good sources on this topic that all focus around the same general argument. John C. Goodman’s What is Consumer-Directed Health Care? Comparing Patient Power with other Decision Mechanisms discusses the general reasons why America needs to move away from the current health system, and explains why consumer-directed health care is best option to replace the current system. Along the same lines, Consumer-Directed Health Plans: Implications for Care Quality and Cost (executive summary) discusses the need for reducing health care costs and explains how CDHC is intended to help lower these costs. Another article focusing on how consumer-directed health care can solve problems like inflated insurance costs that current plans and policy create is Consumer-Directed Health Plans and The RAND Health Insurance Experiment by Joseph P. Newhouse. Possibly the most informative resource explaining why there is movement towards consumer-directed health care is “Consumer-Directed” Health Plans: Implications for Care Quality and Cost. A publication by the Ethan Allen Institute offers a unique presentation of this topic by walking through the entire history of the health insurance field and explaining how it has evolved into CDHC oriented health care. The 2005 and 2006 versions of the annual EBRI Benefits Conference add even more first-hand insight, and a report from the Government Accountability Office is ideal for a longer exploration of the subject.

What Are the Arguments For Consumer-Directed Health Care?

The KaiserEDU background brief is a good place to start as it offers a very broad introduction to most of the arguments for as well as against consumer-directed health care. Once a broad understanding is achieved, a longer resource that expand on the topic is “Consumer-Directed” Health Plans: Implications for Care Quality and Cost. Another longer resource, Health Savings Accounts: Do Critics Have a Point? addresses in depth the leading arguments for Health Savings Accounts, a very common type of consumer-directed health care, focusing on the role HSAs play in restoring market forces and making medical markets more efficient. Another short publication analyzing this topic is Consumer-Directed Health Plans and The RAND Health Insurance Experiment, which gives a unique argument in support of implementation of CDHC that presents the idea of coupling cost sharing with managed care, but this should not be looked at until some of the other sources presenting more basic arguments are looked at. Two detailed reports on the topic that should be read for a full understanding are Consumer Driven Health Benefits: A Continuing Evolution? and Consumer-Driven Health Care: Beyond Rhetoric with Research and Experience. In a Fox News Interview, David Levitz, vice president of GCG Financial, also adds his opinions as to why consumer-directed health care is beneficial to America.

What Are the Arguments Against Consumer-Directed Health Care?

Most source focus on the same general arguments against consumer-directed health care, but present them in different ways. For a broad introduction to the reasons against consumer-directed health care, read the background brief offered by KaiserEDU. After this, two longer policy syntheses, “Consumer-Directed” Health Plans: Implications for Care Quality and Cost and Health Savings Accounts: Do Critics Have a Point? are excellent sources to look at to expand on what KaiserEdu presents. Consumer Driven Health Benefits: A Continuing Evolution? offers possibly the best explanation of the arguments both for and against consumer-directed health care, and goes very in depth.

Are Consumer-Directed Health Care Plans Working?

There are very mixed reports among the sources as to the effectiveness of consumer-directed health care. Consumer-Directed Health Plans: Implications for Care Quality and Cost (executive summary)] introduces the basic trends in health care caused by CDHC plans. [[http://www.chcf.org/documents/insurance/ConsumerDirHealthPlansQualityCost.pdf|“Consumer-Directed” Health Plans: Implications for Care Quality and Cost and The Promise of Consumer Driven Health Care are two longer sources that take a fairly neutral approach. A report from the National Council on Disability, Consumer-Directed Healthcare: How Well Does it Work?, is a very in depth analysis of the effectiveness of consumer-directed health care, especially as it applies to disabled Americans. Consumer-Driven Health Care: Beyond Rhetoric with Research and Experience offers a very pro-consumer-directed health care performance evaluation that goes very in depth. There is also an audiocast that addresses the topic of how consumer-directed health care is working, but you must buy it to hear it. A better option than this that also gives first-hand statistics would be to watch the videocasts of the 2005 and 2006 EBRI Benefits Conferences.

Resources

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  • Bond, M. T. & Knapp, D. 2001, “The financial impact of medical savings account plans”, Business Horizons. January – February 2001, pp. 77-83.
  • Buttler, E. The Stakeholder Protection Account. 1999. London, UK, The Adam Smith Institute.
  • Central Provident Fund Board. Singapore Central Provident Fund Website. http://www.cpf.gov.sg . 1-1-2002.
  • Chew, R. 1997, “Medical Benefits Coverage in Singapore,” in Affordable health care: Issues and prospects, TT. Meng & CS. Beng, eds., Prentice Hall, Singapore, pp. 257-276.
  • Choon, A. & Low, L. 1997, “Health Care Provision in Singapore,” in Affordable Health Care: Issues and Prospects, TT. Meng & CS. Beng, eds., Prentice Hall, Singapore, pp. 50-71.
  • Choong, M. L. 1998, “Comment on Medical Savings Accounts,” in Choices in Financing Health Care and Old Age Security, vol. 392 N. M. Prescott, ed., The World Bank, Washington DC, pp. 43-45.
  • Consumer Union. Medical Savings Accounts. http://www.consumersunion.org . 2002.
  • Eichner, M. J., McClellan, M. B., & Wise, D. A. 1996, Insurance or self-insurance?: variation, persistence, and individual health accounts National Bureau of Economic Research, Cambridge, MA.
  • Frost & Sullivan. U.S. Consumer Directed Health Plan (CDHP) Markets – Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs). December 2006, Pages: 76. Available through Research and Markets (Order Form $$$).
  • Furman, Jason. The Promise of Progressive Cost Consciousness in Health-care Reform. The Hamilton Project, April 2007.
  • Goodman, J. C. & Musgrave, G. L. 1992, Controlling Health Care Costs With Medical Savings Accounts, National Center for Policy Analysis, Dallas, TX.
  • Hsiao, W. C. 1995, “Medical savings accounts: lessons from Singapore”, Health Aff.(Millwood.), vol. 14,no. 2, pp. 260-266.
  • Hsiao, W. C. 2001, “Behind the Ideology and Theory: What is the empirical evidence for Medical Savings Accounts?”, Journal of Health Politics, Policy and Law, vol. 26,no. 4, pp. 733-737.
  • Keeler, E. B., Malkin, J. D., Goldman, D. P., & Buchanan, J. L. 1996, “Can medical savings accounts for the nonelderly reduce health care costs?”, JAMA, vol. 275,no. 21, pp. 1666- 1671.
  • Landers, S. J. MedPAC: Outlook poor for Medicare MSAs. American Medical News . 15-1-2001. Lim, J. 1997, “Health Care Reform in Singapore: The Medisave Scheme,” in Affordable Health Care: Issues and Prospects, TT. Meng & CS. Beng, eds., Prentice Hall, Singapore, pp. 277-285.
  • Liu, E. & Yue, S. Y. 1999, Health Care Expenditure and Financing in Singapore, Legislative Council Secretariate, Hongkong.
  • Liu, G., Cai, R., Zhao, Z., Yuen, P., Xiong, X., Chao, S., & Wang, B. 1999, “Urban Health Care Reform Initiative in China:Findings from its Pilot Experiment in Zhengjiang City”, International Journal of Economic Development, vol. 1,no. 4, pp. 504-525.
  • Liu, Y. 2002, “Reforming china’s urban health insurance”, Health Policy, vol. 60, pp. 133-150.
  • Manitoba Centre for Health Policy. Medical Savings Accounts: A Wolf in Sheep’s Clothing. Winnipeg Free Press [August 19, 2000], A19-A19. 2000.
  • Matisonn, S. Medical Savings Accounts in South Africa. http://www.ncpa.org/studies/s234/s234.html . 2000. NCPA.
  • Moon, M., Nichols, L. M., & Walls, S. 1997, “Winners and losers under medical savings accounts”, Spectrum, vol. 70,no. 1, pp. 26-29.
  • NERA 1997, The Health Care System in Singapore National Economic Research Associates, New York.
  • Nichols, L. M., Moon, M., & Wall, S. 1996, Tax-preferred Medical Savings Accounts and Catastrophic Health Insurance Plans: A numerical analysis of winners and losers, The Urban Institute, Washington, DC.
  • Owens, D. & Holle, P. 2000, Universal Medical Savings Accounts: Consumerizing Medicare to end waiting lists and improve service Frontier Centre for Public Policy, Winnipeg, MB.
  • Ozanne, L. 1996, “How will medical savings accounts affect medical spending?”, Inquiry, vol. 33,no. 3, pp. 225-236.
  • Pauly, M. V. 2001, “Medical Savings Accounts in Singapore: What can we know?”, Journal of Health Politics, Policy and Law, vol. 26,no. 4, pp. 727-731.
  • Pauly, M. V. & Goodman, J. C. 1995, “Tax credits for health insurance and medical savings accounts”, Health Aff.(Millwood.), vol. 14,no. 1, pp. 126-139.
  • Phua, K. H. 1987, “Saving for health”, World Health Forum, vol. 8, pp. 38-41.
  • Phua, K. H. 1997, “A Medical Savings Accounts and Health Care Financing in Singapore,” in Innovations in Health Care Financing, G. Schieber, ed., pp. 247-255.
  • Phua, K. H. & Teng, Y. M. 1998, “Financing Health Care in Old Age: A Case Study of Singapore,” in Choices in Financing Health Care and Old Age Security, N. M. Prescott, ed., The World Bank, Washington DC, pp. 33-42.
  • Prescott, N. M. & Nichols, L. M. 1998, “International comparison of Medical Savings Accounts,” in Choices in Financing Health Care and Old Age Security, N. M. Prescott, ed., The World Bank, Washington, D.C., pp. 19-48.
  • Ramsay, M. 1998, Medical Savings Accounts: Universal, Accessible, Portable, Comprehensive Health Care for Canadians The Fraser Institute, Vancouver, BC.
  • Schieber, G. 1997, Innovations in Health Care Financing The World Bank, Washington, DC.
  • Sharma, A. B. IMA favours opening up of health insurance. The Indian Express . 24-5-1998. Indian Express Newspapers (Bombay) Ltd.
  • Singapore Ministry of Health 1993, Affordable Health Care Ministry of Health, Singapore.
  • Singapore Ministry of Health 2000, Annual Report 2000 Ministry of Health, Singapore.
  • Singapore Ministry of Health. Our Health Care System.  . 2001.
  • Teh-wei, H. 1999, Cost Sharing in Health Care Financing: International experiences., Hong Kong Policy Research Institute, Hong Kong, May/Jun 99.
  • United States 1996, Health Insurance Portability and Accountability Act of 1996 U.S. G.P.O., Washington, D.C.
  • US Department of Health and Human Services. Your Guide to Medicare Medical Savings Accounts. 1998. Baltimore, MD, U.S. Department of Health and Human Services.
  • US Department of Health and Human Services. President’s budget expands access to health care. 30-1-2002.
  • US GAO 1997, Medical savings accounts: Findings from Insurer Survey Washington, D.C.
  • US GAO 1998, Medical savings accounts: Results from Surveys of Insurers Washington, D.C. (P.O. Box 37050, Washington 20013).
  • US Internal Revenue Service 2001, Medical Savings Accounts (MSAs) Department of the Treasury, Internal Revenue Service, Washington DC. World Bank 2001, World Development Indicators 2001 The World Bank, Washington, DC.
  • Yip, W. C. & Hsiao, W. C. 1997, “Medical savings accounts: lessons from China”, Health Aff.(Millwood.), vol. 16,no. 6, pp. 244-251.
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One Response to “Consumer-Directed H.C.”

  1. Jackie Durkee Says:

    At http://www.FaithfulinPrayer.wordpress.com, I’m writing a series of articles outlining what the the actual House bill (h.r.3200) says.
    So far, I’m at Subtitle 2 of Title II of Division A. Tomorrow will be Subtitle 3.
    Join the Journey!

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