After the Plan is Selected, What Stands Between People and Their Health Benefits?
We’ve said it before and we’ll say it again: benefits have long been perceived as complex and need to be simplified. While our solutions do the heavy lifting to anticipate specific benefits people will need at the time they need them, we recognize there can still be some disconnect. Just because the benefits are put in front of people doesn’t mean there’s a good understanding of how they work.
Awareness is just step one. Inspiring action comes next. As leaders in this industry, we work on awareness and action continuously, because both are key to helping the end user succeed.
In this three-part series, we’re exploring why navigating benefits remains so tricky—the intricacies, the challenges, and everything in between. First up: health benefits.
The complicated nature of health insurance
We can’t talk about health benefits without acknowledging an uncomfortable truth: many people find them intimidating. And that can stand in the way of people engaging with their benefits and achieving better health.
Health-related expenses account for nearly one-fifth of the U.S. economy. In fact, the average annual premium for employer-sponsored health plans is more than $18,700, and employees pay around $5,700 toward the cost of their coverage—no small investment. Stakeholders span health providers, insurance companies, re-insurers, employers, government regulators, employees, and dependents of employees—and they all share a common goal: find the best healthcare at an affordable price.
But when employees in particular don’t take the time to understand the healthcare system, they miss out on foundational knowledge needed to make informed benefits decisions.
Explaining a little bit about how the system works can help employees not only see the big picture, but gain a better sense of how to approach their health benefits and select the right health plan in the first place. Incorporating this into open enrollment presentations, and keeping that information available after the fact, gives employees the context they need to understand the full scope of their health benefits—and what those selections mean.
Define terms, and keep defining them
Today, most large employers provide the choice of one of the following plans: HMO, PPO, EPO, POS, or HDHP. Professionals in HR know the unique trade-offs that come with each one regarding flexibility, coverage cost, deductibles, out-of-pocket costs, etc.—but do their employees?
Clarifying those trade-offs with tools like Evive Plan Choice during open enrollment is the way to start. But what about after the plan is selected?
Employees might understand the basic trade-offs made in the plan selection itself, but do they actually retain that information and know how to apply it to in-the-moment healthcare decisions down the line? Providing descriptions like the ones below not only clarifies the basics behind a chosen plan, it addresses points that may be useful to the employee when making situation-based decisions in their healthcare later.
- Preferred provider organizations (PPOs) are generally the most flexible plans, but also the most expensive. You can receive care both inside and outside the network, and you don’t need a referral from your primary care physician (PCP) to see a specialist. Monthly premiums are higher and you’ll need to meet your deductible before the plan pays benefits.
- Health maintenance organizations (HMOs) require a PCP to coordinate your care as a way to help control costs. You’re required to see providers in the network and your PCP must provide a referral before you can see a specialist. Most HMOs have no deductible that must be met before coverage applies.
- High deductible health plans (HDHPs) require you to pay for your care until you reach a certain level of annual healthcare expenses. They’re also generally linked to a Health Savings Account (HSA) which deducts a set amount from your paycheck each month so you can have the funds to meet the deductible and pay for care.
- Point-of-service plans (POS) are a hybrid of HMOs and PPOs. You need to select a PCP that is in the network, but you also have the flexibility to go outside the network for care. Because you pay for your care at the time it’s delivered, you must also keep receipts and file claim forms for reimbursement.
- Exclusive provider organization plans (EPO) require you to only see healthcare providers that are in the network. You have the flexibility to select specialists without a referral, but they must be in the network. In many ways, it’s like an HMO but you don’t have to select a PCP to manage your care.
Going an extra step to compare said plans and terms can provide more of that much-needed context for employees. For instance, noting that the two most common health plans have historically been PPOs and HMOs, but HDHPs have grown in popularity and become a lower-cost health insurance option for employers over the past decade. POS and EPO plans, on the other hand, are not nearly as common, yet still provided by some employers and health insurers.
Putting those plans to work
With all these factors in mind, it should come as no surprise that people continue to face challenges in using their health plan after they choose it. For many of these people, it’s the feeling of doubt when facing an unexpected health situation and not knowing the most sensible way to cover it. Bottom line: people need to feel comfortable using their health benefits when they need them.
How else can we better support people in maximizing what their health plans have to offer? Encouraging careful tracking of deductibles, co-pays, and out-of-pocket costs can help ensure certain benefits aren’t overlooked—and that overspending doesn’t occur.
Other details to remind employees of include:
- Knowing who is in-network and out-of-network, particularly if the employee has a preferred physician. They may or may not have a choice, and they should know the difference in costs.
- In the case of an HMO, being sure to see their PCP before going to a specialist.
- Contacting their insurance company to check their out-of-pocket balance. This can help determine whether elective procedures need to be done this year, or if they can wait.
- Choosing generic prescriptions—if the employee is comfortable with them—to save on out-of-pocket costs.
- Checking to see if certain tests or prescriptions need to be pre-authorized.
- Getting second opinions for procedures when necessary.
- Knowing when to get preventive screenings to get ahead of any potential health issues before they become serious.
Spend some time helping your employees get to know their health benefits. Empowering them to take more control over their costs and to have the confidence to make informed decisions on quality care provides each employee with better care at the right times and saves costs. When you help simplify the navigation of health benefits, there are endless, meaningful impacts that can arise—for employees and employers alike.