McKinsey, a very smart firm that should be trusted about as far as it can be thrown in terms of putting its clients’ interests above its own, is out with what looks a pretty well researched report on CDHPs. My less well researched opinion is that the CDHP is an intermediate step on the employer’s retreat from offering health insurance, and that the HSA is a foolish tax-deductible sop to the people who would have put that money aside anyway. But then again I’ve got one, as there’s no better alternative.
Essentially the report says that the employees who had CDHPs (connected to HRAs not HSAs but it’s the same sort of thing) were more cost conscious in their health choices than they had been in the good old days of more generous plans, but that they were less satisfied with their health plans. However, the lower spending on care for patients is similar to the introduction of managed care back in the 1990s, other than initially managed care recipients were happier with their plans — as they had lower out of pocket costs than in FFS. One thing I do know is that high out of pocket costs correlates with higher patient dissatisfaction, so as the employees are left more and more on their own, dissatisfaction will likely increase. Still I suspect at least one of my commentators (can anyone guess who?) will tell me that I’m wrong.
And despite some long and complex correspondence with a couple of advocates I still can’t understand why an employer would give their healthy employees money for an HSA and then let them keep it if they didn’t spend it. (In an HRA, it reverts back at year end).