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Rand: High-deductible health plans produce good and bad outcomes

A new study by the Rand Corporation indicates people on high-deductible health plans significantly reduce their healthcare spending – but they're also cutting back on preventive care.

The study of more than 800,000 families across the country showed that when families changed to health plans that carried an annual deductible of $1,000 or more per person, their healthcare spending dropped by an average of 14 percent. Healthcare spending was also lower for those same families with a moderate health savings account.

Savings decreased, however, for families with an HSA where employers contributed more than half of an individual’s deductible.

[See also: Consumer-driven health plans increase rolls to 22 million in 2010; 3 million Californians use high-deductible health plans]

"We discovered that costs go down dramatically during the first year people are enrolled in high-deductible health plans, as long as the deductible is at least $1,000 per person," said Amelia M. Haviland, a study co-author and a statistician at Rand, a nonprofit research organization. "But we also found concerning reductions in use of preventive care. This suggests people are cutting both necessary and unnecessary care."

High-deductible health plans have been growing in popularity in recent years as employers seek ways to reduce the overall spending on health benefits. In 2009, 20 percent of people with employer-sponsored healthcare benefits were enrolled in such health plans, and last year more than half of all employers offered at least one high-deductible health plan option.

These plans, also called consumer-directed health plans, were predicted to reduce overall healthcare spending as members become more discriminating in how they spend money on healthcare. But while the study indicated this is the case, members of these plans also showed a marked decrease in such preventive measures as childhood vaccinations, cervical and colorectal cancer screening and routine blood tests for people with diabetes.

“If this persists, it is likely to have health consequences in the future," Haviland said. "These cutbacks could cause a spike in healthcare costs down the road if people end up sicker and need more-intensive treatment."

More troubling was data that showed even if a high-deductible plan waived the deductible for preventive healthcare services, people in these plans would still cut back on preventive care.

The finding about preventive care has implications for the adoption of national healthcare reform in the United States. As part of the Affordable Care Act, health plan deductibles must be waived for preventive treatments. The Rand study suggests that this fact must be clearly communicated to the public to meet the goal of increasing the level of preventive care received by Americans.

"There's general agreement that the U.S. healthcare system needs to reduce costs while maintaining quality," said Haviland. "We found that at least in the short run, high-deductible health plans are providing the desired reduction in costs. But they are also discouraging families from getting the preventive care they need."

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