Taking a Closer Look at Consumer Driven Health Insurance Plans in Ohio

Consumer-driven health insurance plans in Ohio are becoming a popular option for those seeking coverage. In order to decide if such a plan is the best fit for you, let’s take a closer look at consumer driven Ohio health insurance plans by taking a brief glimpse into their past, observing how they work in the present, and specifying how they may be affected in the future.

Past:

These plans first emerged in the 1970‘s with the creation of the flexible spending account (FSA). While these plans, caused individuals to consider their expenses before spending, they fell short of the consumer-driven approach, as they allowed members to go on a spending spree at the end of the year if they had overestimated what they would spend on medical care.

2002 saw the beginning of health reimbursement arrangements (HRAs). With these new plans, came the ability to roll over unused funds to the next year with the hope of encouraging consumers to shop around and spend their money more wisely. However, in the case of an HRA, it was the employer, not the employee, paying into the account; and thus, they accomplished less than ideal results.

Not until 2004 did health savings accounts (HSAs) hit the market. With the advent of this new style of coverage, came the first true consumer-driven health plans. These plans allow the consumer to set aside their own money, on a tax-fee basis, to spend on qualified medical expenses. By both paying into the account and retaining the ability to roll over unused funds, members of HSAs tend to save more than they spend and are more likely to shop around for the best use of their money.

Present:

While health savings accounts have grown to cover around 13.5 million Americans nationwide, they took a major blow this past year with the Patient Protection and Affordable Care Act. Under this new legislature, HSA members can no longer use their tax-free savings to pay for over-the-counter drugs. While the provision affected all three of the aforementioned plans, FSA consumers were particularly impacted, as they could no longer use up their remaining funds at the end of the year by stocking up on pain killers and other over-the-counter medications. In spite of these set backs and while many thought that the HSAs would disintegrate with the new health care laws, it seems that they are here to stay and are still a leading option for those seeking health coverage. 

Future:

When looking to the future of consumer-driven Ohio health plans, it is important to understand how the new 2014 legislation will affect this type of coverage. The first provision for “Essential Benefits,” stipulating that all non-grandfathered plans must cover ten basic categories of care, does not impact consumer-driven plans one way or the other. Whereas, the “Deductible Limits” and “Out of Pocket Limits” will likely benefit consumer-driven health insurance immensely by creating a wider price gap between these plans and their traditional PPO counterparts.Understanding consumer-driven plans for health insurance in Ohio, can better equip you to make the right decision for you or your family concerning health coverage. Whether you’re an employer or employee, don’t wait until 2014 to make a decision about switching to an account-based plan. Millions have already chosen one of these plans as the best health insurance option for them. If you’re shopping for health care coverage, stop in to your local health insurance broker and discuss whether a consumer-driven account is the best choice for you and your future.