Employees and HDHPs

All Complementary Benefits Executive Health March 15, 2017

Our Director of Sales recently talked a lot about high deductible health plans (HDHPs) and how the shift to these types of plans is forcing employees to shoulder a lot more of the health expenses.

Here’s a quick recap:

  • Premium increases are causing employers to make the shift to HDHPs to lower the cost of providing their employees’ healthcare.
  • HDHPs by nature have high deductibles that the employees must meet before coverage for their health expenses actually kick in.
  • The 2017 out-of-pocket maximum (the max amount employees could feasibly have to pay on their own) is $14,000 for a family. This amount has been steadily rising.
  • Because health costs are rising faster than wage increases, people are spending more of their income on health expenses than before.

So of course, this doesn’t sound great, even when you’re just looking at the facts. But let’s check in with how the employees are feeling about this shift. A recent survey found the following results:

  • Almost half of employees find enrollment stressful
  • 20% of employees regret benefit decisions
  • 68% of employees believe HDHPs are more expensive than alternative options
  • 30% of employees note that HDHPs involve bigger risk on their part
  • 67% of employees attempt to educate themselves about their benefits

Even though many employees are taking it upon themselves to learn about their benefits and the options available to them, that doesn’t mean they have a thorough understanding. Switching to a HDHP makes an already stressful and confusing time even more so. Employee education is crucial in moments like this, whether the employee has to decide between an HMO or an HDHP or has no choice in switching.

The other point that employees may not realize is that this trend is unlikely to reverse. Jeff Bakke, Chief Strategy Officer of WEX Health says, “It’s not a question of ‘Will we ever go back to fully funded healthcare?’ Employers can’t afford it. It’s never going to happen.” In addition, 60% to 70% of the plans in the market are HDHP and Bakke believes it’s where the majority are going to continue to be.

Despite this fact, there are ways to help your employees with the burden of the high deductible. Supplemental tools like health accounts, voluntary plans and expense reimbursement plans can lessen the blow. New supplemental products are coming to market designed specifically for this purpose as well.

Interested in finding out about our supplemental healthcare reimbursement plan? Head over here.

“Employers turning to high deductible health plans.” EBN


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