Question

7. A newly popular type of insurance is a " consumer-directed health plan," where individuals i have large deductibles to encourage prudent purchasing. Who is likely to sign up for these plan? From what you know about the RAND health Insurance experiment, is this approach likely to control health care costs? What are the drawbacks of such plans?

Answer 1

Answer :

Consumer directed health plans :

These will available from different forms, in these most common are offering a high deductible health plans, and out of pocket cost or health savings account or integrated health reimbursement arrangements.

The employees or the consumers must have to take decisions regarding their health, so those are most likely to sign up for these plans.

RAND health insurance experiment :

It is an experimental study health care costs, utilizations, and out comes in the United States, in which different kind of plans randomly given or assigned to the people and see the health care outcomes.

In this approach cost sharing reduced use of service with negligible effects on health,

Drawbacks :

* it is weak at assessing the health effects of cost sharing,

* it is reduced uses by the poorer people it should have measurable and harmful effects on health.