How Employers Can Help Make Health Care More Affordable for Employees - RMC Group

The Kaiser Family Foundation reported that nearly half of Americans struggle to afford health care, with about 4 in 10 saying they’ve delayed or gone without health care due to cost. Unfortunately, medical costs are projected to continue increasing. Financial services organization, Peter G. Peterson Foundation, found that, on average, health care costs U.S. households $12,900 per person per year. Furthermore, some experts warn that the full impact of healthcare inflation hasn’t been felt, because health plans often have multiyear contracts that lock in costs.

Helping employees access affordable health care can improve their overall health, decrease stress, help employers attract good employees and contribute to employee retention.  This article provides guidance on how employers can help make health care more affordable for employees.

How Health Care Costs Impact Employees

The 2023 Healthlock Attitudinal Survey found that nearly one-third of surveyed Americans feel overwhelmed by health care and medical bills. While cost was a major factor, 63% of people also reported the medical billing process as challenging. Those responding to the survey were often anxious about the time and effort that it takes to manage their medical bills.  Unexpected bills and affordability were other concerns.

Low rates of health care literacy contribute to the stress associated with paying medical bills. In fact, a 2023 survey by voluntary benefits solutions provider Optavise found that 10% of people do not know what an insurance premium is, and that 8% do not know the meaning of “in network” or “out of network”.  The failure to understand health insurance can cause employees to make uninformed and costly medical decisions.

Additionally, Optavise’s survey found that employees are still not getting the information they need from their employers to make informed healthcare decisions. Many survey respondents were self-taught, and just 30% had learned about health care from their employer’s HR department, down from 37% in 2021.

How Employers Can Help

Many employees look to their employers for guidance and information regarding their healthcare plans. According to Optavise, 39% of employees want to learn more about managing surprise medical bills, 33% want to know how cost-sharing works and 22% want to know how to choose a health plan. Employers who educate their employees on these topics can help workers avoid large and surprising medical bills and reduce healthcare costs for employees and their organizations. Employers should consider the following strategies:

• Rethink health care resources. Research shows that employees aren’t getting the information they need to make wise healthcare decisions. Although many employers have tried to provide resources across a variety of channels, the Optavise survey found that employees don’t find these resources particularly useful. Less than half of employees found emails to be helpful, compared to 68% who found online resources helpful. However, both strategies paled in comparison to in-person conversations, which 80% of employees found very or extremely helpful. Surveying employees regarding communication channels can help employers identify the best methods for communicating information. Additionally, providing information over various channels may be more effective than using a single channel.
• Require employees to reenroll in coverage. Employees who have the wrong healthcare coverage may buy more or less insurance than they need, resulting in extra premium expense or high medical bills not covered by insurance.  According to the Optavise survey, of the employees who do not change health plans, a large majority (76%) were satisfied with their plans.  However, other employees do not change health plans because they are too confused (6%), did not know it was open enrollment (4%) or didn’t know how to change plans (2%). Employers can encourage employees to reexamine their healthcare plans by requiring them to reenroll every year instead of automatically rolling over the previous year’s selections. It’s also crucial that employers provide consistent and accurate information regarding open enrollment and the importance of signing up for healthcare benefits.
• Help employees to become educated health care consumers. Just 31% of Optavise survey respondents said they check if a healthcare provider accepts their insurance before making an appointment.  In addition, while the majority (87%) of respondents have a primary care physician, 26% said they go to an urgent care clinic for nonemergency care, 10% use retail care clinics and 7% go to the emergency room. This contributes to costly care and increasing medical debt.  Employers can encourage employees to choose in-network providers, rely on their primary care physician for nonemergency care, make careful decisions about prescription drug treatments (e.g., consider using generic brands) and carefully review medical bills for mistakes.
• Offer voluntary benefits. Certain benefits, such as high-deductible health plans (HDHPs) and health savings accounts (HSAs), can help employees pay for medical bills. HDHPs can help employees lower monthly healthcare premiums, while HSAs allow employees to make tax-free contributions to pay for qualified medical expenses, including deductibles.  Additionally, employers can offer financial planning and debt relief programs to help ease the burden of medical bills.

Conclusion

Improving the affordability of health care for employees can reduce group plan costs, decrease employee stress, and boost morale and job satisfaction. These efforts are also critical to maintain a healthy workforce and attract top talent.

Contact us today for more health care resources or to speak with our licensed Health Insurance Professionals at 239-298-8210 or health@rmcgp.com.

This article is not intended to be exhaustive, nor should any discussion or opinions be construed as professional advice. © 2023 Zywave, Inc. All rights reserved.