I recently read an alarming statistic regarding the percentage of employees who fully understand their employer-sponsored health benefits. According to a 2016 survey by Policygenius, only 4% of Americans could define the following terms:
- Out-of-pocket maximum
Benefits professionals and human resources personnel are well aware of these terms and their definitions, but perhaps might assume that plan participants completely understand the scope of their benefits as well. Often, employees find themselves taking a more active role in understanding their benefits when they or a family member experiences a medical crisis. Unfortunately, only when they find themselves up to their eyeballs in medical bills do they start digging into how much their healthcare actually costs them, from the deductible, to the copays, to the total out-of-pocket costs they can expect to pay.
Fortunately, with all of the great employee education methods available, employers can take steps to reduce “sticker shock” by adequately educating employees about their benefits package before any medical emergencies arise. In order to provide the highest value possible, it’s crucial that plan sponsors address and employees understand:
What portion of benefits does my employer pay for?
One of the biggest questions in a job candidate’s mind is “what are the benefits like?” Many candidates inquire about benefits during an interview, but are typically only told who the insurance carrier is and perhaps details regarding other fringe benefits, such as paid sick leave or vacation days. Candidates who are seriously interested in the total value of the compensation package, upon being offered a position, may inquire further about the monetary value of the benefits being offered. Many employers, however, aren’t prepared to disclose this information, whether they simply don’t have these totals in a presentable format or maybe because it’s not part of their on-boarding process. A great value-add to any current and prospective employees’ compensation package is to provide a statement of benefits which shows how much you, as an employer, have contributed to their benefits package during the course of the year.
What portion of my benefits do I pay for?
In addition to the amount you cover as an employer, do your employees know how much of their benefits costs they are responsible for? Typically, healthcare premiums are displayed on a paycheck stub or other online pay portal, but with the increased number of employers offering direct deposit over the past several years, employees might easily overlook these allocations. In addition to premiums, do employees know what they can expect to pay when they report to their doctor’s office, urgent care, or a lab for blood work? Usually, these costs are printed on the insurance card, but healthy employees who rarely go to urgent care, for example, might be alarmed to find that they owe something to the provider before being seen. This is just one small example, but it’s important to ensure employees are aware of all their co-pays, deductibles, and total out-of-pocket costs.
What physicians, laboratories, facilities, and pharmacies are covered on my plan?
Any plan participant who recently switched health plans might be surprised to find out that “their doctor” may no longer be considered “in-network” on their new plan. That’s why it’s so important to point employees in the right direction in obtaining this information, whether via newsletters or company intranet resource pages. Typically, health insurance carrier websites offer a comprehensive list of covered physicians and facilities by network. Also, many health plans now have mobile apps that make finding a doctor, pharmacy, lab, etc. very easy.
What services are covered on my plan?
I think we’ve all been in a situation at one time or another where we’ve gone to the doctor only to be referred out to another provider, typically a specialist. And most of the time we just agree to the recommendation and proceed to schedule an appointment with that provider, hoping to be seen as soon as possible. But sometimes, we get a call from that physician’s office informing us that they don’t accept our insurance or our insurance doesn’t cover the services they offer. And so begins a seemingly endless cycle of phone calls in order to address our underlying medical condition, whatever that may be. Most of this perceived hassle could have been prevented had we thought to ask if these services were covered in the first place. Fortunately, these resources can also easily be made available on a company intranet page or benefits newsletter.
Providing valuable benefits information ahead of time not only properly educates employees, but also can eliminate a lot of the frustrations in dealing with any setbacks in seeking medical care, which can negatively detract from the value of your organization’s health plan. If you need more information on developing a solid employee education strategy, it would be my pleasure to assist you. Taking the time to put an education plan in place provides big value for your health plan and ultimately serves to help you recruit and retain top talent.
At CBIZ, we know the importance of developing effective communication techniques, coupled with the expertise necessary to execute and implement a strategy. Clear and effective communication is needed for a successful employee benefit plan. Health plans are expensive benefits that require employee decision-making, so it is essential to give employees the information and tools they need to enroll and make the most of the program. CBIZ will assess your population and identify the different employee segments and create a multi-channel employee education and engagement campaign tailored to those various segments.