Avoiding needed care
Getting care but struggling with the resulting financial stress
Both paths can affect a company’s bottom line in terms of productivity, satisfaction and loyalty.
HSAs TO THE RESCUE?
Understanding that the HDHP strategy may be putting too much financial burden on employees, employers have turned to the solution that was created two decades ago: health savings accounts (HSAs). HSAs have been touted as a foolproof way to address the HDHP-created coverage gaps, but have they really measured up? Let’s take a closer look by pulling back the curtain on the HDHP/HSA dynamic duo.
SHORTFALL #1 NOT ENOUGH
HSA contributions often fall far short of the cost of even an average-sized deductible. Employees facing coverage gaps presented by HDHP/HSAs can struggle with financial hardships, even with medical expenses under $1,000.
A recent Kaiser Family Foundation poll found that almost half the number of employees surveyed would not be immediately able to afford a surprise medical bill of $500. (KFF, 2020)
SHORTFALL #2
BAD TIMING
HSA funds must accumulate before they can be used. This means that available funds might not match up to when expenses are incurred. Or, funds might be depleted (by routine or unexpected healthcare expenses) more quickly than anticipated.
SHORTFALL #3
WHERE’S THE STICKINESS?
Even when they are funded by the employer, HSAs can be viewed as “dollars in, dollars out.” Employees use them for medical expenses but don’t necessary perceive HSAs as valuable, just transactional. Another reason HSAs fall short in creating loyalty is because they’re portable so employees can take the account with them when they leave for another job opportunity.
The Bottom Line
Employer-funded HSA contributions can fall short, with hidden costs and consequences for employers and employees. In a fiercely competitive hiring market, businesses can’t afford to lose key talent.
This peek behind the curtain can give you the insight to help your clients make better benefit and business decisions. And there is an approach that lowers the risk of these hidden costs for employees. It’s the boost that’s been missing all along.
Don’t Change Your HDHP/HSA Strategy. Make It Better.
What if there was a way to eliminate the downsides of an HDHP… A way to turn the funds you have accumulated in your HSA back into savings… And provide employees what they want: better insurance protection.
There is with BeneBoost by ArmadaCare, an add-on health insurance solution designed to do what HSAs are not. This fully insured health plan that complements HDHPs to:
- Provide tax-efficient* coverage from day 1, reducing timing issues.
- Alleviate the strain of everyday or unexpected out-of-pocket medical expenses that are often the source of employee worry.
- Offer coverage that addresses employees’ life and health stages.
- Help employers drive productivity and retention of key talent.
BeneBoost Highlights
- Coverage for routine and unexpected medical expenses (doctor visits, hospital visits, diagnostic tests, Rx and more)
- Per diem (scheduled) benefits available from day 1
- Extra protection of insurance
- Guaranteed issue (no pre-existing limitations or waiting periods)
- Flexible start: beginning of any month
- Employer decides eligibility
- All or select employees
- Any enrollment tier (no need to match primary plan)
About ArmadaCare
*This is not local, state or federal tax advice as each person and each company is unique. It is recommended that you seek the independent counsel of a professional tax adviser.
ArmadaCare’s supplemental health insurance policies are underwritten by SiriusPoint America Insurance Company.
Interested in learning more about ArmadaCare’s market-leading supplemental health insurance products?
Get in touch with one of our experts. You choose the time that’s best for you, and we’ll do the rest!