Health insurance - your way, sort of

The rising cost of health care coverage has prompted growing interest and enrollment in consumer-directed health plans (CDHPs), according to a study released by the Government Accountability Office (GAO) yesterday. CDHPs are offered by private health insurance carriers to employers and individuals. A CDHP combines a high-deductible health plan with a health reimbursement arrangement (HRA) or health savings account (HSA), both of which have tax advantages.

HRAs and HSAs allow CDHP enrollees greater discretion in their health care. Because unused funds can be accrued, the report notes the incentive for enrollees to limit their health care expenditures; the counter-argument is that with its high deductibles, CDHPs may only attract healthier individuals and thereby raise premiums in traditional plans where the less healthy remain. Because CDHPs are relatively new, GAO did a broad survey of government and industry officials and employers and financial institutions for this study.

CONSUMER-DIRECTED HEALTH PLANS: Small but Growing Enrollment Fueled by Rising Cost of Health Care Coverage, GAO-06-514, April 28, 2006
     Full report (pdf, 644KB, 38p.)
     Highlights (pdf, 56KB, 1p.)
     Abstract (html)

Related GAO reports on CDHPs for federal employees:

FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM: First-Year Experience with High-Deductible Health Plans and Health Savings Accounts, GAO-06-271 (pdf, 544KB, 28p.), January 31, 2006

FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM: Early Experience with a Consumer-Directed Health Plan, GAO-06-143 (pdf, 480KB, 27p.), November 21, 2005