HSAs
Enrolling Employees in HSAs–Coming Up with a Game Plan
by Bob Manzer

The popularity of health savings accounts (HSAs) has skyrocketed over the past two years. About 600,000 people enrolled in HSAs in 2004 and that number shot up to more than 2 million by 2006, according to the Henry J. Kaiser Family Foundation. HSAs are an attractive product for your clients since they offer premium savings for employers and portability for employees. (Employees keep the money if they change or lose their job.)
   But, is pairing of consumer-directed healthcare (CDHC) plans with HSAs the magic bullet to lower costs and improved employees’ health? Some early studies are encouraging. A 2005 McKinsey & Company report reveals that CDHC plan users are more value conscious; pay more attention to wellness and prevention; and are more attuned to their healthcare costs. The results for CDHC plan members include the following:
• More than 50% are more likely to ask about cost.
• About 25% are more likely to engage in healthy behaviors.
• More than 20% are more likely to follow treatment plans for chronic conditions.
   However, a comprehensive strategy to lower costs and improve health must include more than savings accounts. An effective health benefits package should include a wide range of decision- support tools to help employees manage their money and their health. Ensuring that your clients’ employees take full advantage of a CDHC plan begins with the way HSAs work. For example, take the HSA debit card. The debit cards do more than provide a convenient way to pay for healthcare costs – they also create an accurate financial record to help employees track and manage their healthcare spending.
   An HSA can be even more convenient if the third-party administrator of the account provides around-the-clock access to account information. Then, employees can easily view their account balance and change investment options. With the right tools, employees can choose from different money market funds, depending on their investment needs. The combination of an accurate spending record, online account access, and investment options can help employees spend their healthcare dollars wisely. They’ll find that their ability to save grows from year to year.
   A doctor can recommend lifestyle changes, but employees need the right tools to manage health and healthcare effectively. A solid CDHC plan comes with online decision-making tools, a host of preventive care services, and wellness programs.
   Two useful tools that help employees understand the cost of treatments and compare actual health costs are a treatment cost estimator and a sample fee list. A treatment cost estimator calculates estimated out-of-pocket costs for selected diseases and conditions, surgeries and procedures, office visits, tests, and more. A sample fee list for a specific provider shows estimated charges for frequently used medical services and products, such as lab tests, X-rays, and prescription medicines. This tool can help employees plan for out-of-pocket expenses and manage the funds in their HSA.
   Preventive care includes routine physicals, mammograms, immunizations, diabetes screenings, and flu shots. For example, diabetes screenings that detect unusually high blood sugar counts prompt employees to make lifestyle changes so they can control their cholesterol and their blood sugar levels. Without preventive services, health problems can go unnoticed until they reach a crisis stage and result in costlier treatments and chronic or acute conditions.
   When your employees go to the doctor for their annual physical, wouldn’t it be great if they could share the results of a detailed online health questionnaire? A good questionnaire will assess health-related behaviors, including physical activity, stress, weight, and nutrition. This effective tool lets employees and their physicians come up with an individualized plan to modify bad habits or unhealthy behaviors.
Other valuable online tools are health calculators and health and drug encyclopedias. Health calculators can measure an employee’s body mass index (BMI), pregnancy due date, or stress levels. These tools help identify health risks, encouraging employees to take steps to improve health. Online encyclopedias provide employees with in-depth information about diseases and conditions, treatment options, and drug side effects. Having such information can mean the difference between an expensive doctor’s visit and an inexpensive drugstore remedy.
   Convenience is an important part of managing health. Employees often like to use online services because it’s easy. They’ll save time and hassle if they can refill prescriptions, check lab results online, choose a doctor, locate offices, and e-mail questions to their doctors.
Employees can be encouraged to manage their health in all kinds of ways. Health education classes can go a long way toward educating employees and answering questions. Health classes can cover a range of topics such as nutrition, stress management, prenatal care, asthma education, and even yoga. The more options employees have to manage their health – from health education classes to online tools – the more likely they’ll be to take care of themselves.
   Employees who have the resources to manage health as well as their healthcare finances can gain the greatest benefits from an HSA plan. The more preventive care services and decision-support tools that are available, the easier it is to connect employees to a healthier lifestyle. Encourage your clients to explore these different aspects of an HSA plan and to make sure their employees understand what’s available to them. The results will be savvy healthcare consumers who share responsibility with their employers for their healthcare choices.
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Bob Manzer is the regional sales director for Kaiser Permanente in Northern California. He has more than 25 years’ experience in managed healthcare and is responsible for both small and mid-to-large group sales. Bob can be reached at bob.manzer@kp.org or 916-614-4531.