Health Insurer pushes health budgets

By Marguerite Higgins

September 30, 2005



National health insurer Humana Inc. this week opened a campaign to encourage families to budget for health care costs.

The Louisville, Ky., company is working with Consumer Action, a San Francisco nonprofit group advocating consumer rights, to promote the idea.

A Web site, www.familyhealthbudget.com, enables consumers to calculate an estimate of their yearly health costs.

"Employees are bearing more and more of the health care costs over time," said Humana President and Chief Executive Officer Michael McCallister. Many U.S. families do not budget these costs and are unaware of what they spend on average, he said at a Washington press conference on Tuesday.

Mr. McCallister would not say how much the campaign cost Humana, describing it as a "modest underwriting" for the company. Humana plans to expand the Web site, adding a Spanish version and information packets, as the campaign unfolds.

In addition to giving an estimated total, the Web site also gives broad suggestions on how consumers can improve their health care budgets.

Advice for lowering out-of-pocket expenses includes buying more generic drugs, visiting the emergency room only for emergencies and looking into free-standing diagnostic and surgical centers.

Consumer Action Executive Director Ken McEldowney said he felt confident Humana, with 7 million policyholders, was not pressuring consumers to buy a particular health plan through the Web site.

Midsize health option

Benu Inc. this month entered the D.C. area with a new health care option for midsize businesses.

The San Mateo, Calif., company works with national health insurers to provide competitive health plans from each insurer to workers in midsize companies, which have at least 75 employees.

"This market segment doesn't have a lot of options because they aren't large enough to have negotiating power with insurers and not small enough to take advantage of government regulations," said Benu President and Chief Executive Officer Jeffrey Closs.



Benu started offering the health plans to companies in the District, Maryland and Northern Virginia in addition to its current markets in Oregon and Washington state.

In the D.C. area, Benu is working with insurance carriers Kaiser Permanente and Cigna Corp. to provide health plans for the businesses.

Benu generally offers more health options to businesses, compared with what they might get by negotiating on their own because of a risk adjustment Benu performs for insurance carriers, Mr. Closs said.

That risk adjustment compensates the insurers for the risk they take in enrolling all of the employees in the customer company.