Furthermore, CIGNA's study points out that if the number of Americans enrolled in a CDHP rose from the current 18 percent to 50 percent, the U.S. could achieve $350 billion dollars in savings over 10 years. Think of the impact that could make in the overall cost of health care.

As further proof that consumer-directed plans work, the Milliman Medical Index 2010 notes that while out-of-pocket health care costs were more than $3,000, potential savings from using a flexible spending account would have reduced that number by nearly a third.

To encourage participation in a CDHP, employers may want to think of “seeding” the program with initial funds. This is particularly true if the organization is offering an FSA, which tends to lack the popularity of health reimbursement arrangements and health savings accounts due to the “use it or lose it” provision in FSAs.

Land O'Lakes is one of a number of larger companies saving money through the use of consumer-directed health plans. Since Jan. 1, 2007, when the first CDHP was offered, the company and its employees have saved more than $10 million in health plan costs.  The company attributes its successes to open communication with employees coupled with consumer-focused information and tools.

Education adds up

The importance of educating participants in consumer-directed health plans continues to become more important as more of the decision making is put on the consumer's shoulders. In order to make these informed decisions on health care, consumers are requesting data, facts and figures—in fact, 90 percent of consumers say having quality information is essential. 

Without question, educating consumers is one of the largest challenges employers face. 

As in the case of Land O'Lakes, information and education designed specifically for each employee or participant is critical to the success of consumer-directed health plans, and it helps employees make the best decisions on their own care choices. It's important to remember that a well-designed CDHP alone won't be effective at controlling costs or improving health without a thorough and continuous education strategy. When employees have a strong understanding of their health care plan, they become more involved, competent consumers.

Both third party administrators and employers, however, need to remember educational materials have to resonate with a wide variety of people. Many only have a high school diploma and a median income of $48,000, while half are likely to be health illiterate. Materials also have to resonate with young people, the blue collar worker, and even college-educated participants who are unfamiliar with CDHP jargon.

Luckily, participant education has been refined over the past few years and learning from others will save employers valuable time. Keeping in mind that consumers are busier than ever, the key is to keep things short, simple and easy.

In addition, consumers now learn and gather information in different ways, so reaching them using a variety of formats will be important. Some still prefer traditional paper methods, such as newsletters, posters and direct-mail postcards, while others prefer short notices, online messages or mobile video. There has been a rise in popularity of online flash commercials, which can focus on specific lifestyles such as those with families, those who are single and those nearing retirement.

Some of the most successful participant education campaigns take place during off-enrollment periods, which breaks up the routine of receiving benefits information only at certain points during the year. Participants also have more time to absorb educational info rather than at enrollment time when participants are deluged with materials.

Visually-engaging materials graphically depict specific items covered under their consumer-driven health plan, like Lasik eye surgery, braces, crutches, and over-the-counter medications. Examples and lists like this are especially valuable for those new enrollees who are trying to come up to speed quickly with their benefit debit card and CDHP, whether they're enrolled in an HRA, HSA or FSA.

In addition to listing out specific items that are covered, it is recommended to show participants side-by-side comparisons of post- and pre-tax savings. (One example: an FSA modeler that estimates savings, is below.) Especially in today's economy, simply educating participants on the amount of money they can save each year is an effective way to demonstrate the benefits of a CDHP.

While there are more and more health care options for today's consumer, one thing is certain: Consumer-driven health plans are here to stay. While they present a communications challenge for employers, they also present a unique opportunity and can prove successful as long as a comprehensive education and communications plan is in place.

Anne Carpenter is a vice president of Evolution1, a provider of comprehensive electronic card payment, on-premise and cloud computing solutions for the administration of flexible spending accounts, health savings accounts, health reimbursement accounts, VEBAs, wellness and transit plans. Contact Anne at [email protected].