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Consumer-Driven Health Care from Cal-Nevada Insurance Agency

Consumer-driven healthcare plans (CDHPs) offer employers a way to provide workplace health insurance but at a more affordable price for the company than traditional group health insurance.

At Cal-Nevada Insurance Agency, our business insurance clients in California, Arizona and Nevada often find that a consumer-driven health plan meets employee needs without breaking the bank.

CDHP Basics

Consumer-driven health insurance plans encourage policyholders to take a greater role in their healthcare decision making by placing more of the financial responsibility for treatment in their hands. Some do this by making participants pay a higher deductible; they are often called high-deductible health plans. Other versions modify traditional healthcare plans by using higher co-pays for higher-cost providers, or they allow the employer to make health plan payments part of a defined contribution benefit plan. Your Cal-Nevada agent will go over all the specifics and help you find the plan that best meets your company’s needs.

Personal Health Accounts

Often, a CDHP is associated with an employee savings account that is dedicated to medical costs. A health savings account (HSA) is one that can be funded with pre-tax employee income. The employer can supplement the account, but the funds belong to the employee and can be taken to another job.

A health reimbursement account (HRA) is another CDHP-affiliated savings vehicle. The employer sets up and funds the HRA without any limits. Its funds don’t affect employee compensation and are used tax-free for qualifying medical expenditures. The funds are not portable.

The flexible savings account (FSA) option is similar to the HSA, but it can be associated with a traditional health insurance plan, as well. Deposited funds are pre-tax dollars and are not subject to payroll taxes. Funds not used by the end of the plan year are lost to the employee.

If you want to offer a health plan but are worried about costs, look at consumer-driven healthcare.

For further information or to schedule a meeting with an advisor, contact us at (866) 670-5948, or e-mail us at