Employers Offer Decision Support and Incentives to Encourage CDHP Use

May 17, 2010 (PLANSPONSOR.com) – Workscape’s 3rd Annual Benefit Survey indicates that organizations that are serious about consumer-driven health plans (CDHPs) offer decision support to help employees get the best out the program and incentives to give employees a nudge to begin using decision CDHP plan tools.

The survey found about half of small and mid-sized organizations and close to two-thirds of large organizations have adopted at least one CDHP or high-deductible health plans (HDHP). More than three-quarters (76%) of large employers (>5,000 employees) offer decision support tools to CDHP participants, and another 3% plan to do so within the next 12 months.  

In addition, 61% of small organizations (<1,000 employees) and 71% of mid-sized employers (1,000 – 5,000 employees) offer decision support tools. Decision support tools include Web-based information, cost calculators, and plan comparison tools.  

According to the survey report, roughly a quarter of organizations offer employees incentives to use decision support.  

Incentives offered include:

  • Gift certificates,
  • Cash incentives,
  • Premium reductions,
  • Lower deductibles,
  • Health club memberships,
  • A chance to win something.

Some organizations indicated they also encourage employees to use decision support tools through town hall meetings, one-on-one consultations with HR specialists, and/or handing out information during open enrollment.  

Workscape found significant differences between industries in their adoption of CDHPs/HDHPs. Just under 80% of financial organizations have adopted such a plan – almost twice the percentage of government organizations. The big jump, however, occurred in the health care industry, where the number of firms offering CDHPs/HDHPs increased from less than half to almost two-thirds, the report said.  

In addition, there has been a modest increase in adoption of health disease management programs in all sizes of organizations, with almost 80% of large organizations offering these programs.

Employers Report Benefits Changes during Recession  

Respondents to Workscape’s 3rd Annual Benefit Survey reported a number of steps they have taken to reduce benefits or increase employees’ cost of benefits during the tough financial times. Forty-two percent of small organizations said they had reduced benefits or increased employee contributions, as did 39% of mid-sized firms and 35% of larger firms.  

Specific benefits changes cited, according to the survey report, included:

  • 401(k) match eliminated;
  • Temporary cut to 403(b) match and paid time off accrual;
  • Change in vesting of retirement benefits;
  • Implemented prescription drug deductible;
  • Increased premiums, copays, & coinsurance;
  • No longer offer health insurance;
  • Dropped dental, vision, and eye coverage;
  • Increased the number of years employees must work to get health insurance when they retire;
  • Shifting more of the cost to part time staff;
  • Eliminated retiree benefits;
  • Lengthened eligibility waiting periods;
  • Dropped voluntary benefits such as concierge, services, and special child care benefits;
  • Reduced number of vacation days employees earn; and
  • Suspended tuition reimbursement.

The survey also found some employers turn to outsourcing open enrollment to save on costs. Among large organizations outsourced solutions are up to 40% from 34% in 2009.  Twenty-four percent of mid-sized organizations use outsourcing as do 22% of small firms.  

A total of 868 responses were collected for the survey. A complimentary white paper containing the full survey results can be requested from http://www.workscape.com/benefitstrends2010.