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5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.
from Spencer’s Benefits Reports: Consumer-driven health plans (CDHPs) might require more than financial incentives to help consumers make smart choices about their health and prescription use, according to a new study by pharmacy benefit manager Express Scripts.
The study found that CDHP participants sometimes were less likely than traditional health care plan enrollees to change behavior and take advantage of cost-saving generic drugs; CDHP participants curtailed brand-name medication use instead of consistently substituting generic for brand-name medications.
“CDHPs do not automatically produce more cost-effective behavior,” said Glen Moller, vice president of product development for Express Scripts. “Our research shows that consumers need more and better tools to make prescription drug choices that maximize both health and financial outcomes.”
The Express Scripts study reviewed the results of two national employers that began offering a CDHP as a benefit option in January 2006 without consumer tools. The study, involving 19,500 enrollees of employer A and 14,600 enrollees of employer B, examined prescription claims during the first nine months of 2005 and 2006, respectively. At both employers, the study compared CDHP and traditional pharmacy benefit plan experiences. A significant number of employees enrolled in the CDHP plans: 36% for employer A and 22% for employer B.
While implementing a CDHP produced considerable prescription drug cost savings, the main source of savings came from cost-shifting, with enrollees paying a greater proportion of their drug costs through high CDHP deductibles. Utilization decreases and higher enrollee payments associated with the CDHPs led to net plan cost reductions of 62% for employer A and 24% for employers B.
Although CDHP enrollees at both companies reduced their use of brand-name medications by about 13% to 14% following enrollment, those reductions were not offset by increases in generic medication use. Meanwhile, enrollees in traditional pharmacy benefit plans increased their use of lower-cost generic drugs, while their use of brand-name drugs remained unchanged from 2005 to 2006, resulting in net utilization increases.
On a per-enrollee basis, growth in generic claims for employer A’s traditional plan more than doubled over that of the CDHP, 18.6% versus 7.5%. At employer B, the per-enrollee growth in generic claims for the traditional plan was 17%, but was only 13% for the CDHP. These differences were more pronounced at the beginning than at the end of the study period in the traditional plan versus the CDHP, except for cholesterol-lowering drugs.
The report says that it is unclear why the rate of switching from brand-name to generic cholesterol-lowering medications actually appeared to be higher for the traditional insurance than for CDHP enrollees in employer A. While the reasons underlying these switch patterns remain unexplained, the findings do not suggest that CDHPs “automatically” produce more cost-effective behavior, according to Express Scripts.
The complete study, What Happens to Prescription-Drug Use After Consumer-Directed Health Plan Enrollment?, is available at http://www.express-scripts.com/ourcompany/news/outcomesresearch/onlinepublications.
For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.
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