A more engaged consumer’

Wellpoint alters plans

By Ashley M. Heher, Associated Press, August 27, 2006

INDIANAPOLIS – The nation’s largest health insurance company is looking to expand its consumer-driven health plans to 27 million customers as part of a broad offering across the country that shifts away from traditional coverage.

The move, which comes as corporate America eyes ways to curtail health insurance spending, requires workers to take more responsibility for their medical care in the hopes of reducing frivolous health spending.

The plans, which often include health-savings accounts and have high deductibles, are based on the premise that people are less likely to choose expensive treatments if they could spend less out-of-pocket for a cheaper option.

“It’s all really designed to make you a more engaged consumer,” said Jason Gorevic, president of Wellpoint’s New York market who is spearheading the initiative. “We know that if you’re more involved in your health care – if you’re acting as more of a conscientious health care consumer it’ll be better for your health.”

And, Wellpoint says, it could also be better on a pocketbook.

The company estimates the average person could save $400 a year on the new program, factoring in tax benefits and company participation incentives.

But not everyone is convinced the concept is flush with savings.

Despite increased interest in the program – Wellpoint says three-quarters of its January inquiries from national companies wanted information on consumer-directed plans – some customers have been slow to sign up.

“When employees have a choice of a consumer-driven health plan and other traditional health benefit plans, take-up has been pretty low,” said Alwyn Cassil, a spokeswoman for the Washington-based Center for Studying Health System Change.

“Maybe they do the math and they decide it’s not such a great deal for them,” she said. “The only place these are getting real traction in the employer group market is when they are basically a total replacement and you have no choice.”

Still, 28 percent of companies surveyed this year said they are offering consumer-directed plans, up from 22 percent in 2005, according to a study of 434 employers released in June by Aon Consulting and the International Society of Certified Employee Benefit Specialists.

Industry predictions put consumer-driven plans at 25 percent of the total health insurance market by 2010.

Wellpoint, which already offers the consumer-health plans for about 700,000 customers, is expanding the program with help from its subsidiary, Lumenos.

Company officials declined to say how much the expansion would cost, and said costs would be part of the Indianapolis-based company’s operating expenses.

Wellpoint isn’t the only company to throw its muscle behind consumer-driven health plans.

A spokeswoman for UnitedHealth Group Inc. said last week that the Minnetonka, Minn.-based company has nearly 1.8 million people – from individual customers to large corporations – enrolled in the company’s consumer-driven plans.

Hartford, Conn.-based Aetna Inc. has 572,000 members enrolled in similar plans.

Wellpoint must still receive state regulatory approval for the expanded program.

Gorevic said the plan’s rollout should be completed by the end of 2007.