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Alternatives to traditional health insurance

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As health care costs continue their upward spiral, employers are looking for ways to hold down expenses. Preferred provider organizations (PPOs) remain popular, but employee participation in consumer-directed health care plans (CDHPs), health reimbursement accounts (HRAs) and health savings accounts (HSAs) are on the rise. Here are the U.S. enrollment stats for 2007:

PPOs         165 million enrollees

CDHPs      12.5 million

HRAs         7.5 million

HSAs         5 million


  • Consumer-directed health care plan—a high-deductible health plan combined with a health reimbursement account
  • Health reimbursement account—an employer-funded plan that reimburses employees for medical expenses not covered by a standard health insurance plan
  • Health savings account—an employer-funded account created so employees can pay for medical expenses not covered by a high-deductible health plan
  • Preferred provider organization—a health insurance plan in which employees receive more coverage if they choose health care providers approved by or affiliated with the plan
Source: American Association of Preferred Provider Organizations, 2008 Study of Consumer-Directed Health Plans

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