Study: Employees may make wrong decisions based upon uncertaintiesNew white paper from HSA Bank identifies the tools required to help employees through the process
Milwaukee, July 24, 2018 — HSA Bank, a division of Webster Bank, N.A., released a new white paper today for employers and benefit consultants that addresses the lack of understanding many employees have when it comes to complex health insurance decisions.
According to a recent survey, only 10% of employers are very confident that their employees understand the choices they are making when it comes to health insurance.* Employees may make the wrong decision on health plan based on uncertainty about plan cost sharing amounts, fear of a high deductible or out-of-pocket maximum, or lack of plan evaluation. With so many factors influencing the health plan that is right for a particular employee and their family, it is essential for employers to provide the tools necessary to evaluate plan options, and help them understand the significance of their decision and its impact on their physical and financial health.
HSA Bank’s newest white paper, titled Are your employees selecting the right health plan?, provides insight into:
- Why employees may choose the wrong health plan
- How employees can evaluate health plans to make the best decision for their situation
- What employers can do to help employees during the health plan selection process
“It’s important for employers to educate employees on health plan selection and teach them how to evaluate plans,” said Chad Wilkins, president of HSA Bank. “HSA Bank’s Health Plan Comparison Calculator is just one way to help employees make the best decision for their unique situation.”
Excerpts from Are Your Employees Selecting The Right Health plan?
Why people choose the wrong plan
Consumers can end up selecting the wrong plan for several reasons: uncertainty about plan cost sharing amounts, fear of a high deductible or out-of-pocket maximum, and lack of plan evaluation. Uncertainty about plan cost sharing amounts and their impact According to HSA Bank’s Health & Wealth IndexSM, 35 percent of consumers are not aware of their health plan’s cost-sharing amounts, including the copay, deductible, and out-of-pocket maximum.
Without understanding the financial implications of cost-sharing amounts, consumers are not prepared to make educated decisions about their health plan. According to an HSA Bank survey, 33 percent of HR executives believe that the copay amount is most important when selecting a health plan, and 27 percent believe that a low deductible or out-of-pocket maximum is most important.
However, HSA Bank believes that the total estimated annual cost of medical services (covered and out-of-pocket) should be the most determinative factor when selecting a health plan; this is a better representation of actual annual healthcare expenses. Seventeen percent of the employers surveyed agreed.
Steps employers can take to help employees make the right decision
- Encourage employees to use a health plan comparison tool.
- Have a defined communication plan based on your employee population.
- Work collaboratively with your benefits consultant.
- With hundreds of different benefit providers and varying levels of coverage and cost, the process of choosing a benefits plan that is both cost effective and high quality has become an incredibly specialized field.
- Start the conversation early about health plan choices and how to evaluate plans.
- Help employees make the right decision for their situation by offering dedicated one-on-one and group time, either virtually or in person, for employees to ask questions.
- Provide education year-round about how to not only select plans but also best utilize the plan chosen.
Health plan decisions are complex, and it is common for employees to make the wrong decision based on uncertainty
about plan cost sharing amounts, fear of a high deductible or out-of-pocket maximum, or lack of plan evaluation. With so many factors to consider, it is essential for employers to provide employees with the tools necessary to evaluate plan options properly. Educational resources and plan selection tools help employees understand the significance of their
decision and its impact on their physical and financial health.
Employers can find additional support through their HSA provider and benefits consultant to educate employees and help them make the most of their benefits. Most importantly, employers and employees should recognize that although
these decisions are difficult, it is better to make progress toward understanding health plan choices and improve confidence in health plan selection each year than to do nothing.
To learn more download the white paper.