The Pros And Cons Of Healthcare Plan

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CDHP can be defined narrowly as health care aimed for customers, and refers to insurance plans in health that give members opportunity to use their health savings accounts , health reimbursement accounts, or similar medical payment plans to pay routine healthcare expenses directly. Health plan that are highly deductable cushion individuals from disastrious medical costs. The highly deductible health care plan is cheaper but is characterized by routine payment of medical premium using prefunded account by a debit card or insurance payment plan (Buntin, Damberg, Haviland & Kapur, 2006).
The cost and administrative burden of providing health care benefits to employees has grown rapidly in the last several years, and organizations have opted to cheaper means of doing this by resorting to CDHPs programs that are little bit cheaper when using deductible health insurance plans. This has led to the hope of healthier generation in the near future as the cost of health services would be manageable (Buntin, Damberg, Haviland & Kapur, 2006).
There two primary Health Plan forms today which include; Health Savings Account (HSA) and Health Reimbursement Account (HRA) are being heavily marketed to employers because they provide comprehensive financial assistance to employees for health purposes hence renders the employer with little cost to incur for employees medical cover. These forms of health care are very common in hazardous environment where there is high risk of getting injured like industrial workshops (Feldman & Parente, 2010).
A consumer-directed health plan (CDHP) offers lower premiums in exchange for higher patient deductibles than traditional plans. Those who adopt CDHPs are pay for most of their routine care. Its goal is to make cu...

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...ke FSAs, they could increase health care spending rather than reduce it, as any consumer-driven plan should. These problems could be fixed, however. Congress did authorize a one-time rollover of unused FSA funds to an HSA (same for HRA funds). Congress should go further than a one-time allowance and change the FSA’s use-it-or-lose-it rule to a use-it-or-save-it provision. Congress also could give employees an ownership right to their HRA funds
HSAs and HRAs provide an exciting new possibility for employers who seek to better control their health care costs. These plans also represent an opportunity for employees to become more active in the management of the health care that they receive. The choice between an HSA and an HRA deserves an employer’s careful consideration. The administrative, practical, and tax implications of each must be carefully considered.

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