GAO Study Finds CDHP Enrollees Healthier than Those in Other Health Plans

The GAO said enrollees in the HRA groups of both employers spent less and generally used fewer health care services before they switched into the HRA in 2003 than those who remained in the preferred provider organization (PPO), suggesting that the HRA groups were healthier. Average annual spending per enrollee for the public employer’s HRA group was $1,505 lower than the PPO group for the two-year period prior to switching, and the private employer’s HRA group spent $566 less per enrollee for the two-year period prior to switching than the PPO group.  

The agency also reviewed 21 studies that assessed the health status of HRA and other CDHP enrollees, and 18 found they were healthier than traditional plan enrollees based on utilization of health care services, self-reported health status, or the prevalence of certain diseases or disease indicators. The GAO said other demographic differences may also explain spending and utilization differences including that policyholders in the HRA group were younger than those in the PPO group.  

Specifically, according to the GAO report, for the public employer, from the two-year period before switching—2001 to 2002—to the five-year period after switching—2003 to 2007—average annual spending for the HRA group increased by $478 per enrollee compared with $879 for the PPO group. This smaller increase for the HRA group was partially driven by decreases in spending for prescription drugs. Additionally, average annual utilization of services per enrollee increased by a smaller amount or decreased for the HRA group compared with the PPO group for six out of eight services GAO reviewed.   

For the private employer, from the two-year period before switching—2001 to 2002—to the three-year period after switching—2003 to 2005—average annual spending for the HRA group increased by $152 per enrollee compared with $206 for the PPO group. This smaller increase for the HRA group was partially driven by smaller increases in spending for physician office visits and decreases in spending for emergency room services. Additionally, average annual utilization of services per enrollee increased by a smaller amount or decreased for the HRA group compared with the PPO group for four out of seven services GAO reviewed.   

GAO also reviewed published studies that included an assessment of the health status, spending, or utilization of HRA and other CDHP enrollees compared with traditional plan enrollees.   

The agency said results are not generalizable beyond the enrollees, health plans, and employers it reviewed and also cannot be compared between the public and private employers.