Consumer-Driven Health Plans (CDHPs) Basics and Benefits

What is a CDHP?

A Consumer-Driven Health Plan (CDHP) is a type of health plan that lets customers use pre-tax dollars from a savings account to pay for qualified healthcare costs. Historically, CDHPs were created to help combat rising health care costs, as well as to provide subscribers with increased transparency and control over their health care expenses.

Benefits of a CDHP

There are many benefits to choosing a CDHP for your business and employees.

Higher Annual Deductibles

A deductible is the total amount subscribers are required to pay for medical expenses before the plan begins to pay. Higher annual deductibles help lower immediate medical costs.

Lower Monthly Premiums

A premium is the monthly fee subscribers pay each month to maintain their health insurance coverage. Many subscribers prefer CDHPs because they can keep their projected monthly expenses low.

Enrollment in an HSA or HRA

Employers frequently choose CDHPs because of the flexibility they offer. You can combine a qualifying medical plan with a savings account, either a Health Savings Account (HSA), Health Reimbursement Account (HRA), or Flexible Spending Account (FSA).

An HSA is a tax-exempt savings account employees can use to contribute pre-tax dollars to pay for covered health care costs.² The employee keeps rollover of all unused funds.

An HRA is an employer-funded account. The employer chooses limits on remaining HRA dollars that roll over to future plan years.

An FSA is an employee-owned spending account. Employee contributions to FSAs are pre-tax and do not count as income.

Emphasis on In-Network Providers

Subscribers can see any provider they want with a CDHP, but they'll save money by choosing one of the providers approved in-network. At Cigna Healthcare^SM, our in-network doctors and facilities must meet certain credentialing requirements and agree to accept a discounted rate for covered services under the health plan in order to be part of the network.

Copays

In a CDHP, office copays or coinsurance are what you pay for covered services after you’ve met your deductible. Remember that a copay does not include charges for services not covered by your plan. If you use an out-of-network provider, your expenses may be more than the coinsurance amount shown because the out-of-network provider can bill you for charges that are more than what your benefit plan will pay.

Preventive Coverage

Preventive services for CDHP subscribers are 100% covered.

CDHP vs. HDHP (High-Deductible Health Plan)

A CDHP is a type of high-deductible health plan, but the term “HDHP” usually refers to a high-deductible health plan that does not offer a savings account of pre-tax dollars for qualified medical expenses.

CDHP vs. PPO (Preferred Provider Organization)

You can have a CDHP that includes a PPO plan. PPO plans allow for out-of-network care and are more flexible on the difference between in- and out-of-network providers.

How Cigna Healthcare CDHPs Benefit Employers

Cigna Healthcare CDHPs are designed to create savings for employers without shifting costs to subscribers. Benefits of Cigna Healthcare CDHPs include:

• Single customer service phone number²
• Single contact for employer²
• Debit card for immediate access to funds²
• Autopay available on Medical³
• Streamlined client funding of accounts²
• Fund design flexibility³

To learn more about our CDHPs and find out if they’re right for your business, contact your broker or Cigna Healthcare representative to get more details.