Public Sector

CDH Pricing Model

Unless new consumer-driven health (CDH) products include the right incentives and consumer educational tools to affect the high utilization patterns of employees, the total cost of providing health care benefits is unlikely to change.

Evaluate the design and implementation of a Health Care Reimbursement Arrangement (HRA) product and costs of various HRA benefit characteristics.


Evaluate costs and employee cost-sharing

The model has the flexibility to evaluate the cost of a HRA product based on a variety of pricing variables and during a three-year period. In addition, you can assess the cost of a HRA product by generating an output number representing the ratio of the projected costs under the proposed HRA product to the cost of an established “baseline” health insurance product (i.e., PPO or POS).

Model objectives

  • Design a HRA, consumer-driven product to fit client needs
  • Assess cost distribution between the insured and HRA component of a HRA product
  • Compare employee out-of-pocket expenses for an existing plan and HRA 
  • Model alternative product offerings 

Benefits of CDH Pricing Model

The CDH Pricing model also has the capability of converting the claim cost ratios into PMPM or contract values if the cost of the baseline product is entered.

Measure and analyze insurance offerings

With respect to cost sharing information, you can evaluate an employee’s cost sharing by health status, contract type, and age/gender. The model measures how employees will fair under the proposed HRA product versus the baseline health insurance product. Expressed as a percentage of their particular demographic category, you can identify the percentage of individuals who will be “winners” or “losers” as compared to the out-of-pocket expenses for the baseline product.