Offered more choices, employees will switch health plans — but they're more likely to switch to a different provider of the same type plan than they are to switch the type of plan.
That's according to a study from the Employee Benefit Research Institute, which reviewed a single large employer that increased the number of health plans its employees could choose from.
In 2014, the employer offered an HSA-eligible health plan, an EPO, a PPO and an HMO, all with the same carrier. But in 2015, it added six new health plan choices: HSA-eligible plans, EPOs and PPOs from two additional carriers. This gave employees a total of 10 plans to choose from instead of the original four.
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The new choices used smaller networks of providers than did the original plans, and did not include any out-of-network benefits. Lest only healthy employees would enroll in the new options, leaving the less healthy ones in the original plans, the employer provided financial incentives to encourage people with various health risks to switch to the new plans: lower employee premiums, increased HSA contributions and the elimination of cost sharing for primary care office visits and generic drugs.
The study finds that, among employees enrolled in a health plan in both 2014 and 2015, a third switched plans between 2014 and 2015. Those in the HSA plan in 2014 were more likely to switch than other workers, with half going to different plans, compared with 27 percent among EPO enrollees, 24 percent among PPO enrollees and 13 percent among HMO enrollees.
But of those in the HSA plans who switched, 88 percent chose an HSA plan with a different carrier rather than a different kind of plan. Among EPO enrollees who switched, 63 percent chose an EPO with a different carrier; 72 percent of PPO enrollees went to a PPO with a different carrier. Since there was only one HMO offered, all HMO enrollees who switched went to a different plan type with a different carrier.
Just 5 percent of the HSA plan enrollees in 2014 who switched plans for 2015 changed to a PPO, EPO or HMO with the original carriers, and 7 percent changed both their plan type and carrier.
EPO and PPO enrollees in 2014 who switched health plan types were more likely than HSA plan enrollees to switch carriers, with 24 percent of EPO enrollees and 21 percent of PPO enrollees moving to a different type of health plan with a different carrier, while 13 percent of EPO enrollees and 7 percent of PPO enrollees switched to a different type of health plan with the same carrier.
For this particular employer, the study finds, older workers were less likely to switch health plans than younger workers, and higher-income workers with employee-only coverage were more likely than lower-income workers to switch carriers.
However, higher-income workers with family coverage were less likely than lower-income workers to switch carriers or switch plan type.
In addition, the longer an employee was enrolled in a health plan, the less likely that employee was to switch plans; also, more actual use of office visits for both primary care physicians and specialists was linked to less plan switching.
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