Question

What cost-containment programs or approaches have been used by the health insurance industry in the last two decades? What are the similarities and differences in how these programs use deductibles and cost-sharing options?

Answer 1

Cost containment strategies are the strategies that control the expense level by curtailing unnecessary spending, to increase the profit of the organization.

Cost containment strategies used by health insurance industry:

• Price transparency in different policies and services offered
• Usage of telemedicine
• Usage of generic medicines
• Wellness program for entire family
• Consumer-directed insurance plans
• Tie-ups with MNCs to offer group wellness programs to employees

Employers have shifted the employee medical costs to the ownership of employees themselves. Employers have tried to promote health care consumerism by encouraging their employees to become health care consumers. The deductibles are directed towards the pay structure of the employees. Also, some employers offer cost-sharing options where the employer pays a part of the premium and the employee takes the other part’s onus.