As the cost of health care insurance continues to increase particularly for small businesses, offering a Health Savings Account compatible plan makes great sense for both employer and employee. Employee participation and engagement continues to increase when employees understand and become comfortable with the high deductible plan designs and then reap the financial benefits.
By Dan Cook
Yet more evidence has emerged to indicate that those who choose a health savings account over a health reimbursement account are more fully engaged in the management of their health insurance.
The latest survey to support this conclusion comes from the Employee Benefit Research Institute. EBRI elicited activity responses from those covered by both kinds of plans, and found that the HSA plan members were far more likely to actively participate in their plan decisions than those in reimbursement plans.
This level of personal involvement, which often leads to cost-saving decisions, is one more reason employers are increasingly offering HSAs to employees rather than HRAs.
“People with HSAs are more likely to engage in cost-conscious behavior related to use of health care services than are those in HRA,” EBRI said in a release. “For example, HSA participants are more likely to report that they asked for a generic drug instead of a brand name; checked the price of a service before getting care; asked a doctor to recommend less costly prescriptions; developed a budget to manage health care expenses; and used an online cost-tracking tool provided by the health plan.”
EBRI found that adults in an HSA were more likely than HRA members to do a health-risk assessment. They also tended to participate more actively in programs that promote their health, and they were more prone to doing a biometric screening.
“HRAs and HSAs may be similar, but there are some key differences that may produce different incentives related to using health care services, and different consumer engagement experiences,” said Paul Fronstin, director of EBRI’s health research and education program, and author of the report. “The data show that those with an HSA were more likely to respond to health pricing than were those with an HRA.”
EBRI concluded that the heightened involvement by HSA members was due to the financial incentives HRAs offer their members.
“Ultimately, an HSA creates a stronger financial incentive than an HRA for workers to be more engaged in their health care because the account is owned by the worker and completely portable upon job change,” EBRI said.