Consumer-Directed Health Plans Bend the Cost Curve

That’s the conclusion of a working paper published by the National Bureau of Economic Research, NBER Working Paper No. 21031.

Researchers studied health spending in consumer-directed health plans covering 5 million employees and contrasted with traditional plans covering 8 million employees. They found that total annual health spending fell by 6.6, 4.3, and 3.4 percent in the three years after firms began offering their employees high-deductible health plans paired with tax-advantaged personal medical accounts.

Most of the spending reduction occurred in outpatient care and pharmaceuticals. It was not accompanied by increases in emergency department or inpatient spending. Researchers attributed the spending reduction to “individuals being price-sensitized when faced with relatively high prices.”

Consumer Driven Health Plans 10-14-15

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