A Health Plan With A La Carte Coverage

By Christopher Snowbeck
Star Tribune (Minneapolis)

WWR Article Summary (tl;dr) A startup called “Bind” is selling the concept of “on-demand” health insurance, which lets workers in employer plans buy coverage for certain ailments only if they need the services.

Star Tribune (Minneapolis)

Tony Miller spent years pushing the idea that health plans with special accounts for covering deductibles might transform patients into savvy shoppers.

Now Miller has moved on to a new idea for insurance.

His latest startup is a Minneapolis-based company called Bind that is selling the concept of “on-demand” health insurance, which lets workers in employer plans buy coverage for certain ailments only if they need the services.

Workers pay for a core health plan that covers what most people need. Add-in coverage would cover a few dozen specific services like knee arthroscopy or bariatric surgery that people buy only as needed, for three months at a time.

Subscribers would pay premiums and copays, but no deductibles or “coinsurance,” Miller said.

“Consumers don’t like doing fuzzy math with health benefits,” Miller said. “And fuzzy math is deductibles and coinsurance, because you’re making them figure out a price that the market is not willing to expose.”

Miller was the co-founder and chief executive at St. Louis Park-based Definity Health, a company that helped pioneer what are called “consumer-directed health plans” (CDHPs). Launched in the late 1990s, Definity was at the forefront of a movement that eventually coupled high-deductible health plans with health savings accounts (HSAs).

In these arrangements, employers and employees can put money into an HSA that workers tap to pay for medical services before meeting their deductible. Unused dollars in the account are invested in a manner similar to a 401(k) retirement plan, so workers have incentives to conserve and grow the funds by getting the best deal when buying health care.

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