It isn’t Darwin; it’s behavior

Historically, when indemnity insurance was getting too expensive, HMOs appeared on the scene offering “more” care for less dollars.  Initially, they attracted all the healthy young workers who wanted to save premium and copay money; the sicker people fearful of higher personal costs were willing to pay a higher premium to assure themselves of ready access to high quality (albeit expensive) care.

          Eventually indemnity disappeared and everyone was in HMOs.  Then things like PPOs were formed which were a hybrid between indemnity and HMO.  Over time both those products became very costly.  Consumer driven health plans arose and like their predecessors promised lower costs if you stayed out of the health care system or negotiated lower rates for your own personal care.  If you used the system a lot, it would actually cost you more than the HMO option.  The thinking on the street was that only the “healthy” young will join the new option and the “unhealthy” older would stay with the HMO or PPO.

          Well, I listened to a presentation last week by a human resources vice president who introduced a high deductible health plan in addition to the HMO plan.  He also pushed hard on healthy lifestyles for all the workers.  What was interesting was that the individuals who were changing their lifestyles to make them healthier were the ones electing the high deductible consumer driven plan whether they were healthy to start with or had diabetes or another chronic illness.  The cost savings in the active healthy group was enormous; much of it remaining in their own pockets as savings.  There were as many high risk in each group demonstrating the cost effective nature of healthy living par excellence!

Gerald L. Evans, M.D.