Los Angeles Times Examines Trend Toward Consumer-Directed Health Plans

The Los Angeles Times on Monday looked at the increase in popularity of consumer-directed health plans, which have double or triple the deductibles of traditional health plans and offer "incentives and support" to help people "spend their health care dollars wisely." The plans currently account for about 2% of the market, but they are anticipated to become more common in the coming years as a way "to potentially curb employers' rising health care costs," the Times reports.

Forrester Research, an independent technology research firm, predicts that consumer-directed plans could account for 7% of health insurance by 2007 and about 25% in five years. According to the Times, the idea behind the plans is that "when consumers are held solely responsible for a medical bill, they tend to think twice." The plans take some control over spending away from employers and insurance companies, usually allowing consumers to select their doctors and hospitals.

While proponents of the plans say that consumers will be more careful and cost-conscious if they have a stake in managing the money, critics say that such health plans place a larger share of the costs on consumers and could dissuade them from seeking out needed care (Roan, Los Angeles Times, 8/16).