For decades, the health insurance industry has worked, mostlyunsuccessfully, to slow the pace of increasing cost. The complexityof our medical delivery system makes the task daunting, givencomplex care delivery models, misaligned incentives and paymentmethods, the pace of technological advances, andsociety’s preference for broad provider network access. In recentyears, cost containment initiatives have focused largely onadvancing consumerism to buck the trend, nudging individuals to bemore responsible for navigating the market, and providing toolsintended to help them do so.

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Some consumer tools have had immediate impact; others are andwill continue to be slow to contribute to controlling cost. Telemedicine, for example, holds promise across multiplespecialties, but applications that simply ease access to primarycare services and provide consumer convenience may not reallyreduce system cost. Cost transparency tools theoreticallyalign well with consumer driven health plans, butthe underlying maze of health delivery and provider reimbursementarrangements challenges the near term value these tools offer for many procedures or conditions. In summary, thereare no silver bullets and the health system as structured todaycannot pivot effectively.

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But there are some strategies that can immediately influencecost trends. Providing consumers with access to a health planselection decision support tool is one approach to proactivelymanage cost now. Studies indicate most consumers choosehealth plans poorly; random selection would be as effective — oreven more so.1, 2 Without support, consumers tend to overbuycoverage, stretching to purchase the “richest” coverage plan theycan afford. A good tool helps consumers quantify expectedout-of-pocket costs (e.g. copays and deductibles) for each planoption, giving the individual a complete picture of likely costsfor each plan.

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Picking the right plan can save employees significant money,often hundreds or thousands of dollars annually. And if employeesfeel they’ve made an informed choice of plans, they are more likelyto take ownership for making that choice work. HDHP andHSA selection tends to increasesignificantly with access to decision support, typically leading tomore judicious use of services and a dampened cost trend.

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Decision support can be implemented easily, quickly andinexpensively without disrupting current platforms oradministrative processes, a potentially valuable capability formidsized employers looking to push down the consumer-drivenpath.

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We’ve been evaluating employee use of decision support foryears, and have identified four critical success factors fordecision support models. These factors are consistent with howemployees might view support for other major purchases, like buyinga car or finding the right mortgage. Here are the four key factorsfor effective health plan decision support:

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1. Speed and ease of use is paramount — avoid questions thatrequire research, estimation or calculations. Effectivedecision support does not create work or waste time. Thetool should take less than five minutes so that 50 percent or moreof employees actually use it.

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2. Consumers need to understand totalexpected cost of medical care to make a rationalselection. Total cost is the employee’s share of premium plusestimated out-of-pocket cost for each plan option, taking intoaccount variances in copays, deductibles, OOP maximums,etc. Accurate forecasting of OOP cost, while keeping theuser experience quick and easy, is the holy grail of health plandecision support.

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3. Decision support tools must be accessible,mobile-friendly and adaptable for family discussions orcounselor/enroller support. Output must be informative but notoverwhelming. Good tools don’t make a blanket recommendation butprovide relevant information and rank options by best-to-worst fit,with supporting evidence.

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4. Above all else, decision support models shouldcreate consumer peace of mind — the feeling youget when you make an informed choice. So the model must beunbiased, credible and independent. Models that lead the consumerto consider purchasing ancillary products may not have therigor or impartiality to make the right health planchoice.

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Encouragement of rational consumer behavior in health care is agood strategy for the long term. And helping employees pickthe right plan is an effective, market-proven tactic that can beadopted today, yet a majority of employees still do not have accessto this tool. Why not empower employees now with access to anunbiased and informative exchange-like experience?

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1 “Can Consumers Make Affordable Care Affordable? The Value ofChoice Architecture” Johnson, Hassin et al.

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2 “Do Employees Make Sensible Health Insurance Decisions?....”Bhargova, Loewenstein, Sydnor et al.

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