More California Employers Offering CDHPs

By Staff Report

Dec. 22, 2008

The dominance of managed care in the California market led many benefits experts to doubt if consumer-driven health plans with high deductibles would gain much traction there.

But a recent survey has found that 38 percent of employers in the nation’s most populous state now offer high-deductible health plans to their employees, up from 18 percent in 2007.

However, only 10 percent of employers offering HDHPs to their employees also offer a health savings account, while less than 1 percent offer a health reimbursement arrangement, according to the latest edition of the California Employer Health Benefits Survey, a joint project of the Oakland, California-based California Healthcare Foundation and the National Opinion Research Center.

Even though the percentage of employers offering HDHPs in California surged, the proportion of employees enrolling in the plans remained unchanged from 2007, at 4 percent. By contrast, enrollment nationally in the plans doubled from last year to this year, to 8 percent.

More than three-quarters of California workers were given a health maintenance organization option in 2008, according to the survey, compared with just 41 percent of workers nationally. As such, California workers have been consistently more likely to enroll in HMOs than covered workers nationally, who are more likely to enroll in preferred provider organization plans, the survey noted.

In California, 52 percent of covered workers were enrolled in HMOs in 2008, while 33 percent were enrolled in PPOs, 11 percent in point-of-service plans and 4 percent in HDHPs. By comparison, 20 percent of U.S. workers are enrolled in HMOs, while 58 percent are enrolled in PPOs, 12 percent in POS plans and 8 percent in HDHPs.

Among other findings of the survey:

• Employer-based health care premiums rose by an average of 8.3 percent in 2008, the same as 2007.
• More than half of California employers offered coverage for same-sex domestic partners, more than double the national average. Because of a change in survey wording, the 2008 results could not be compared with those of prior years.
• Thirty percent of covered workers in California were enrolled in a partly or completely self-insured plan in 2008, compared with 55 percent nationally. The gap between the state and national figures is associated with California’s high HMO enrollment since HMOs are less likely than other plans to be self-insured, the survey noted.
• This year’s survey, which was conducted by interview from April to July, included 796 randomly selected participants drawn from the Dun & Bradstreet list of private employers with three or more workers.

For complete results of the survey, visit

Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail

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