Are “Differential Premiums” Good or Bad?
January 16th, 2009 by Kevin
Walmart, Macy's, Best Buy Gift Cards - we call it GlucoCASH
So what’s a Differential Premium?
First of all, I was introduced to the combination of these two words by a health insurance executive during an employer focused health benefits conference back in 2005. Essentially, if you don’t take the actions prescribed for your own care or engage in acts that put you at high risk (ie - smoking) you should pay a higher health plan premium than your counterpart who is taking care and avoiding high risk behavior.
I also happen to remember that old life insurance check list asking me to confirm whether or not I’m an avid skydiver. Of course my premium would be higher. So the fact is that differential premiums have been around for a long time. Only now they are making their way into Health insurance.
Done right I agree with this concept. If you’re the person that goes the extra mile to take care of yourself while the guy in the office next to you always makes the unhealthy choice, why should you both pay the same premium?
However, it all comes down to the accuracy of some process that verifies your promise to be ‘compliant’ and/or that you can prove that you are not engaged in those high risk behaviors… like skipping your meds. How do you prove that you don’t smoke? How are those who decide how much your monthly premium is going to be actually verifying their information?
In a recent post by Amy over at diabetesmine I learned about a new health plan option for some of United HealthCare’s large employer clients (like AT&T for example).
The data from our randomized, controlled clinical trial for AT&T from 2006 - 2007 demonstrated that everyone wins when it’s easy. The difference is in how we go about rewarding for those desired behaviors that lead to lower costs and more productive employees.
If you’re an employee or dependent of one of these large companies, you will probably be very interested to read how Diabetech’s technology makes proving your participation easy while at the same time puts money in your pocket. In the video from United, I’m concerned that their ‘tracking site’ might be a major pita (email me if you want to know what the ‘a’ in pita stands for but here’s a hint: p=pain, i=in, t=the) and that it may be missing the mark when it comes to how their system looks at your data.
We implemented our diabetes programs based on input from large employers, physicians and actual employees with first hand knowledge of what it’s like to get that phone call from the health plan nurse. We decided that eliminating unwanted phone calls from the health plan would be a big win (picture a dark room and a swinging lamp over your head while sitting on the world’s most uncomfortable chair) as long as we can still get insight via trusted data from the patient. Since then a growing number of health plans are also appreciating the fact that our system can help them eliminate unnecessary calls and reduce the time spent on those times when they do call. We also placed the emphasis on easy to digest education by automatically delivering timely, relevant profile-based diabetes education as well as optional reminders. Your data in our programs also supports the determination of who qualifies for GlucoCASH (gift cards from the likes of Walmart, Macy’s, Best Buy, etc…) and for how much $$$. All the while making every day diabetes care easier vs. those employees who don’t have access to our programs. The proof behind these claims including significant reductions in A1c and high participant satisfaction is well documented on our clinical trial experience pages here.
Perhaps one of the biggest reasons for having a program like this from an independent third party like Diabetech vs. your health plan is to maintain privacy and independence from your employer. After all, HIPAA was supposed to be all about making your health benefits Portable thus allowing employees a certain degree of independence from their employers.
So to all those people who have the option to enroll in these new diabetes specific health plans, make sure you tell your employer that you want access to Diabetech’s programs which are now being covered by a growing number of health plans some of which have integrated our program with their own. Our programs are also eligible for coverage through Health Savings Accounts (HSA) and Flexible Spending Accounts (FSA).
Ultimately, a combination of reduced out of pocket expenses and just in time behavior triggered rewards helps to ensure that everyone concerned wins. The key to all of this is making sure that the program content is accurate, relevant and useful and most of all - easy for the patient!
Last 5 posts by Kevin
- What's in a name? - March 7th, 2010
- Steve Ponder MD, CDE - Headliner Extraordinaire - January 22nd, 2010
- Fallen Hero Now a Competitor? - January 20th, 2010
- Man Made Barriers to a Man Made Solution - January 16th, 2010
- Healthy Families of South Texas - Launch Day - December 31st, 2009
