In the next few weeks, millions of American employees will choose which health insurance plan will cover them and their families for calendar year 2005.
Among the choices facing some is an innovative insurance plan pioneered in 1992 in South Africa by a firm called Discovery and marketed in the United States as Destiny Health. It's an approach George W. Bush's and Congress's health care policymakers should keep in mind as they scramble to come up with proposals to deliver on Bush's vaguely worded campaign promises to reform health care finance.
The Destiny health plan has several intelligent features. One is an annual deductible: you pay for basic expectable medical expenses before insurance kicks in. One reason for the high cost of most health insurance is that we expect it to pay for routine medical expenses: it is as if your auto insurance policy covered oil changes but didn't pay you when the car was totalled.
When insurance kicks in, it is in the form of a personal medical fund, similar to the health savings account model that was part of the 2003 Medicare/prescription drug act. Unused amounts can be rolled over into the next year, and employees who leave the company will have access to remaining balances. This encourages employees to treat the money as if it is their own -- which it is -- and to keep cost in mind while making health care decisions. Experts of all ilks agree that one reason health care costs keep rising so rapidly is that consumers have gotten into the habit of making decisions with no regard at all for cost. The Destiny plan encourages them to break that habit.
The third and perhaps most interesting feature of the Destiny plan is its wellness programs, designed to encourage healthier lifestyles. Employees' insurance premiums are cut if they abstain from smoking, exercise regularly, hold down their weight and seek preventive care such as Pap smears or prostate exams. For achieving such goals, they earn "vitality points," which can be redeemed for health club memberships and travel discounts.