This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

New Aon Hewitt Survey Shows Growing Prevalence Of Consumer-Driven Health Plans

Stocks in this article: AON

LINCOLNSHIRE, Ill., Sept. 17, 2012 /PRNewswire/ -- Consumer-driven health plans (CDHPs) have surpassed health maintenance organizations (HMOs) to become the second most common plan design offered by U.S. employers, according to new survey findings from Aon Hewitt, the global human resource solutions business of Aon plc (NYSE:AON). 

(Logo: http://photos.prnewswire.com/prnh/20100719/AQ37264LOGO)

Aon Hewitt's survey of nearly 2,000 U.S. employers representing over 20 million U.S. employees and their dependents found in 2011 that 58 percent of employers offered a CDHP and 38 percent offered HMO plans. Preferred provider organizations (PPOs) continue to be the most widely offered plans, with 79 percent of employers offering these plans in 2011.

Among employers that offer CDHPs, health savings accounts (HSA) outpace health reimbursement arrangements (HRA) by two to one (34 percent versus 18 percent). However, Aon Hewitt's survey shows a higher number of employees enrolling in HRAs, with 43 percent of employees enrolling in HRAs compared with 28 percent in HSAs. This reflects the fact that HRA plan designs are popular among large employers embarking on full replacement CDHP strategies, as they offer more design flexibility to the employer than HSA designs. HSAs, on the other hand, are typically offered as one of several plan options available for employees to choose between and therefore generate lower enrollments.

"As employers struggle to address unsustainable increases in health care spend, they can no longer rely on traditional methods of tweaking plan designs like increasing copays and deductibles or increasing employee payroll contributions for medical coverage," said Maureen Fay, senior vice president and head of Aon Hewitt's CDHP working group. "Employers are beginning to explore innovative solutions that focus on both the short-term need to manage health care costs and the longer-term requirement to change underlying behavior patterns, shifting the focus from 'caring for the sick' to 'actively managing the health of their employees.'  Consumer-driven health plan designs are becoming increasingly popular among employers because they provide them with a vehicle for promoting consumerism and a framework for educating and motivating employees to actively engage in understanding and managing their health."

Promoting Enrollment in CDHPs

Despite an increase in prevalence, Aon Hewitt's survey found that enrollment in CDHPs lags behind PPO and POS plans. The average enrollment in a PPO plan was 69 percent in 2011 followed by POS plans (49 percent). Forty-three percent enrolled in a high-deductible CDHP with an HRA and 28 percent enrolled in a high-deductible CDHP with an HSA.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs