Complex health plan options overwhelm employees
Even as Congress works on a replacement for the Affordable Care Act that may have a greater role for consumer-driven healthcare options such as health savings accounts, a new survey finds that the majority of employees are clueless about the benefits of HSAs. And they often don’t have the knowledge and lack the accountability to make informed decisions about their health insurance coverage, according to data from healthcare solutions provider Alegeus.
In its “State of Denial” survey of more than 1,000 healthcare consumers, 63% said that they do not know the benefits of an HSA. Plus, nearly one-third “feel no better today about managing their healthcare finances than when they first got healthcare on their own,” Alegeus finds.
The numbers get even more dispiriting from there.
The Alegeus survey found that 70% would like to take a more active role in their healthcare decisions, but only 50% intend to conduct more due diligence when purchasing healthcare in 2017. Half of all respondents reported that they don’t know how to predict current or future out-of-pocket healthcare expenditures and cannot select the best savings vehicle or rate.
The survey findings did not surprise an independent benefits consultant who frequently works with Alegeus.
“There is greater adoption of HSAs and health reimbursement arrangements but we have a great deal of distance to go before people are empowered and informed healthcare consumers,” says John Young, CEO of ConsumerDriven. Young also serves as a healthcare lobbyist.
The reasons for this confusion, Young explains, are the abundance of health insurance plans, confusing and often contradictory options, and complex technical jargon.
“There is also a dichotomy of what people say is important and what they really do,” Young says. “There are a number of people who say ‘I am going to do more, I will take a more active role in my healthcare,’ but when you look at the results, very few people sign up for the tools that are available to them.”
Employees also have an inflated sense of their own benefit plan fluency. The survey found that 39% of workers enrolled in healthcare benefit accounts rated their understanding of the offerings as “competent,” but only 30% of HSA account holders can pass a basic proficiency test. Further, 26% don’t know that they can use HSA funds beyond the immediate plan year, and 41% were unaware that they can invest HSA funds.
“This research affirms that consumers feel the impact of the consumerism movement in healthcare and they need help to manage their increased financial responsibilities,” says Alegeus CEO Steven Auerbach. “There is tremendous opportunity for the future winners in healthcare to create a real environment that supports and guides consumers.”
Often, consumers’ behavior resembles a “deer in the headlights,” Young says. “We don't know really what to do to take those necessary steps to be a stronger and more confident healthcare consumer.”
The benefits industry must improve its outreach efforts to end this employee confusion. “I think the industry does a fair job of bringing the information to the individuals, but we need to do a better job of reaching people where they are to really help them understand it.”