Medical costs can be cut

By JOSEPH M. LaGUARDIA
SPECIAL TO THE VINDICATOR
Health care and the way we pay for it is changing, as illustrated by a recent story in the news.
The Wall Street Journal reports that Wal-Mart plans to hire a health care communications specialist to help explain its new health insurance benefit for the company's employees. Starting next year, Wal-Mart will make a low premium, high deductible health plan the primary option for new hires. While this will represent a big change for employees at the nation's largest retailer, it's really not that complicated.
As health care costs continue to increase, employers and consumers are looking for ways to control costs and get more value for their health care dollar. Consumer-driven health plans give you more ability to manage your health care spending.
Generally speaking, here's how a consumer-driven health reimbursement account (HRA) works:
Personal HRAs
At the beginning of the year, your employer funds an HRA in your name. These funds are used to pay for covered medical services, including prescription drugs for you and your family. There's no co-payment or deductible upfront. No money is taken from your account for preventive care. For example, an annual physical is covered at 100 percent.
Once all the money in your account has been spent, you pay a "bridge," similar to a deductible, which may be the next 1,500- 3,000 for a family. After that point, you may pay 20 percent of covered medical expenses for the rest of the year until you reach the out-of-pocket maximum, which could be 4,000, for example. Beyond the out of pocket maximum, covered medical expenses are paid at 100 percent for the remainder of the year. Any amounts remaining in the account at the end of the year are carried over to the next year.
A health savings account (HSA) also has consumer friendly features -- it's tax-favored and allows you to make contributions in addition to what your employer puts in. And the HSA is portable. If you take a new job, the HSA money goes with you.
Consumers are responding in a positive manner to consumer-driven health plans:
Those with health reimbursement arrangements tend to be more engaged in activities that improve their health, such as healthy eating, preventive care and wellness programs. They were 20 percent more likely to follow treatment regimens for chronic conditions.
50 percent were more likely to ask about health care costs and twice as likely to ask about drug costs.
Those with any type of consumer-drive health plan were more aware of health costs and were more likely to make careful, value-conscious health-care decisions.
Health insurance companies like Anthem Blue Cross and Blue Shield are offering online support tools that offer wellness tips, help estimate your health care costs and help you determine if a consumer-driven health plan is right for you.
Change isn't easy, but these are definitely changes worth making.
Joseph LaGuardia is regional vice president of group sales for Anthem Blue Cross and Blue Shield in Ohio, the state's largest health insurance company.