SIHO Consumer Directed Health Plans

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Consumer Directed Health Plans

Are you tired of paying more each year for health insurance coverage only to receive fewer benefits?

SIHO Insurance Services Consumer Directed Health Plans (CDHPs) may be able to help.

The increasing cost of health care is a tremendous problem for employers and employees. The causes are many and complex, with no simple answers. However, there is one piece of the solution that is very evident and undeniable: getting people healthier will lower their medical costs.

Easier said than done? Absolutely! The illnesses and costs that result from poor health habits take years to occur. Reversing these habits will also take time, and will require the member to be a more active participant than in the past.

How does someone become a more active participant in their health plan? By having a greater financial stake in how they use healthcare services, and by having tools available to help them along the way. This is the essence of SIHO CDHPs.

CDHPs are
an emerging new
trend in health plan design.
They include both Health
Reimbursement Arrangements (HRAs)
and Health Savings Accounts
(HSAs). Both couple a higher
deductible health plan with a
personal health care account that
the member controls. Personal
health care account dollars that
are not used, accumulate. Armed
with information on health and
wellness and the cost and quality
of services, members have the
tools and financial incentive to
be better health care
consumers.

SIHO CDHPs consist of two parts:

An affordable health plan that provides comprehensive coverage for office visits, preventive care, prescription drugs, hospital costs, and physician services
A Personal Health Care Account that can be used to pay for services that are the responsibility of the member, those that are subject to deductible and coinsurance. If the member does not use any or all of their account dollars, those dollars roll over to the next year and will accumulate to provide greater financial protection!

Crossing the River

Employers try many tools to slow the increase in health insurance costs. Probably the most popular is “cost shifting,” asking the employees to pick up more of the cost. This can be done by increasing the payroll contribution — not a popular option — or increasing the plan deductibles, co-pays, and coinsurance. While the latter is also not very popular, it is generally more palatable than the former and is used more often.
The problem with increasing deductibles is that it can create a large financial risk for the member. Moving from a $250 deductible plan to a $1,000 can be viewed as a widening river that the member may need to cross. For most employees a $250 river can be managed, for some $500 will be a struggle, for many $1,000 is very difficult. If they were to need knee surgery, or be hospitalized for pneumonia, how do they come up with $1,000 or $2,500? While these plans save the employer premiums, it makes the employees feel vulnerable and unhappy with their health insurance benefit.

Without
the Health
Care
Account Bridge. . .

Building the Bridge

The key to building the Health Care Account Bridge is to use health care services wisely and conserve the account dollars so that they roll over and accumulate. In this way you can save enough dollars to more than cover the deductible exposure.

By becoming a better health care consumer you can actually make the river more narrow! You will not need as many services and you will stretch your health care dollar further.

Conserving Personal Health Care Account dollars does not require the member to skimp on preventive care. These are generally covered in full with only a modest co-pay required. In fact getting all of the recommended preventive care services and taking maintenance medications is highly encouraged! These help keep people healthy and will save Personal Health Care Account and health plan dollars.

About Consumer Directed Health Plans

Consumer Directed Health Plans come in two categories: Health Savings Accounts (HSA) and Health Reimbursement Arrangements (HRA).

Columbus	Bloomington	Evansville	Indianapolis	Seymour
(812) 378-7000	(812) 245-5300	(888) 843-1312	(800) 873-2022	(812) 524-2704

This brochure is for informational purposes only and it is not intended to serve as a legal interpretation of benefits. The entire provisions of benefits and exclusions are contained in the Summary Plan Description (SPD), Certificate and Schedule of Benefits. In the event of a conflict between the SPD and this Guide, the terms of the SPD will prevail.