High-deductible plans don't reduce low-value healthcare spending, study says
A new study published in the American Journal of Managed Care found that consumer-directed health plans (CDHPs), also known as high-deductible health plans (HDHPs), are lowering overall outpatient spending, but not reducing “low-value” healthcare spending.
The report found that switching to a CDHP resulted in a $231.60 reduction in annual outpatient spending for members. However, those members used about the same amount of low-value imaging, laboratory tests and procedures as those in traditional health plans.
The researchers suggested that CDHPs in their current form “may represent too blunt an instrument to specifically curtail low-value healthcare spending.”
The researchers found “no significant reductions” in annual spending on the 26 low-value services. There was a small reduction in low-value spending on imaging, but not in overall imaging spending and no significant reductions in low-value laboratory spending.
To test the impact of CDHP enrollment on low-value healthcare spending, the study analyzed insurance claims data for about 376,000 patients between the ages of 18 and 63 who were continuously insured by a large national commercial insurer between 2011 and 2013. They measured spending on 26 low-value healthcare services, which are frequently ordered despite “evidence of their lack of clinical benefit to patients.” These low-value services include renal artery angioplasty or stent, arthroscopic surgery for knee osteoarthritis, spinal injection for lower back pain and vertebroplasty or kyphoplasty for osteoporotic vertebral fractures. The researchers then compared those results to people who stayed in the traditional plan.
The results mirror other available data, the researchers noted. “CDHPs may encourage patients to curb spending indiscriminately rather than specifically reducing low-value services; more targeted consumer incentives in CDHPs may be necessary to reduce this source of waste,” according to the study.
Reducing low-value services is seen as one way to decrease wasteful spending, while also improving quality. However, the study found CDHPs aren't helping reduce possible wasteful tests and procedures despite the plans’ growing influence in the market. CDHPs now make up about one-third of the health insurance market and a vast majority of Affordable Care Act (ACA) marketplace plans.
The idea behind CDHPs is to give patients more “skin in the game.” CDHPs plans are HDHPs with a health savings account that allows members to save for healthcare tax-free. HDHPs offer low premiums, but members pay more than other plans if they need to use services. CDHP advocates say this prompts patients to search for more cost-effective healthcare and not overuse services.
It's true that CDHPs can reduce overall healthcare spending, but not always in the ways that advocates want. For instance, members may put off care rather than pay more for care in a high-deductible plan. A study published last month in JAMA Internal Medicine found that only 14% of people with high-deductible plans compared prices for healthcare services.
The new report suggested that CDHPs should “encourage more value-conscious choices,” including lowering low-care tests and procedures. One possible solution is value-based insurance design (VBID), which offers lower cost sharing for high-value services and higher cost sharing for low-value services. This type of benefit design is geared to move patients toward value-based care. VBID has shown improved quality and medication adherence, but cost savings are in question, according to the report.
The Center for Medicare and Medicaid Innovation is testing VBID in Medicare Advantage in multiple states. “VBID may offer a more nuanced mechanism than CDHPs to spur value-based behavior, but cost savings are unproven and patients face similar challenges in understanding benefit design features,” according to the report.
- American Journal of Managed Care Impact of Consumer-Directed Health Plans on Low-Value Healthcare