Workers Overwhelmed by Health Care Decisions
Employees are feeling the stress of healthcare costs. In the article below by Jack Craver, he provides insight as to the pressures workers are currently dealing with in todays healthcare marketplace.
Original Post from BenefitsPro.com on July 29, 2016
In case you haven’t noticed, Americans are in a tough spot on health care.
For one, their health care costs far more than that in any other country. Even worse, perhaps, they increasingly have many more decisions to make about how to pay for that care.
A new report demonstrates the frustration and hopelessness that grips so many in the face of health care decisions.
The study by Alegeus, the benefit account platform, surveyed 4,000 adults about their health care choices. It showed that there are seldom health or insurance-related choices that Americans make with relative ease or comfort.
There are no health care finance decisions, for instance, that a majority of Americans don’t find challenging. At the top of the list was “planning for out-of-pocket costs,” which two-thirds of respondents say they found either challenging or very challenging. Fifty-five percent say the same about choosing health care benefits.
Fifty-two percent said they found “maintaining health and wellness” challenging. If respondents are being completely honest with themselves (and the pollster), that figure would probably be much higher, considering that three-quarters of Americans are overweight or obese, and a certain percentage of those who aren’t still engage in unhealthy habits, such as problem drinking, substance abuse, or smoking.
One of the reasons health care is so expensive, many argue, is that for so long, Americans have been shielded from the true cost of care by generous employer-based insurance policies. As employers increasingly shift to high-deductible plans or consumer-driven health plans, millions of Americans are for the first time confronting decisions that in the past were left to higher-ups.
Alegeus CEO Steve Auerbach explained the shifting dynamics of health care shopping to BenefitsPRO.
“In the past, with health plans paying for the majority of health care costs, consumers have been conditioned to be disengaged,” he says. “This shift to consumer directed health care represents a complete paradigm shift in how consumers will need to manage their healthcare going forward — and there is a sizeable percentage of consumers who are resistant to this change. It is definitely going to take time for consumers to acclimate, build confidence, and rise to the occasion.”
He noted, however, that a similar “paradigm shift” took place with retirement benefits two decades ago, as many companies moved from defined-benefit pensions to 401(k)s.
“The infrastructure for education and support had to be built, and consumers had to adapt,” he says. “But now 401(k)s have become ubiquitous.”
See the original article here.
Source:
Craver, J. (2016, July 29). Workers overwhelmed by health care decisions [Web log post]. Retreived from https://www.benefitspro.com/2016/07/29/workers-overwhelmed-by-health-care-decisions?kw=Workers%20overwhelmed%20by%20health%20care%20decisions&cn=20160801&pt=Daily&src=EMC-Email&et=editorial&bu=BenefitsPRO&slreturn=1470060827
Rising Health Care Costs: Driving Factor Causing Changes to Employer Health Plans, SHRM Survey Finds
Get the latest trends in healthcare benefits in the survey conducted by SHRM.
Original Post from SHRM.org on July 13, 2016
- Ninety-six percent of organizations offered some type of health care plan to their employees.
- Mail order prescriptions have gone down by 6 percent over the past five years.
- Eighty-five percent of organizations offer mental health coverage, compared to 91 percent just last year.
- Organizations were evenly split as to whether they offered coverage to spouses who had access to health care coverage through another employer, or if there was a spousal surcharge for health care coverage.
- Several new health-related items added to the survey this year: health care services such as diagnosis, treatment or prescriptions provided by photo or video (23 percent), high deductible health plan not linked to an HSA or a health reimbursement account (HRA) (17 percent), genetic testing coverage for diseases such as cancer (12 percent) and a smoking surcharge for health care plans (20 percent).
Men’s HSA account balances far outpace women’s
Originally posted June 19, 2014 by Dan Cook on www.benefitspro.com. 
Women, on average, don't have as much money in their health savings accounts than do men. This nugget is among the findings of an Employee Benefit Research Institute study, which was conducted on the 10th anniversary of the creation of HSAs.
At the end of 2013, men had an average of $2,326 in their account, while women had $1,526, EBRI said.
While the male-vs.-female gap went unexplained by the researchers, that output was perhaps the most surprising to come from the study. Other findings were more or less in line with expectations about those who choose HSAs to pay for their health care.
EBRI reported that older individuals have considerably more money in their accounts that do younger HSA users: Those under 25 had an average of $697, while those ages 55-64 $3,780 those 65 or older had an average account balance of $4,460.
Younger ones used a small percent of their account balances for health-related expenditures, and they also tended to take fewer distributions from their accounts that did older individuals. Yet at a certain age, the likelihood of a distribution fell significantly.
“The likelihood of taking a distribution increased from 44 percent among individuals under age 25, to 66 percent among those ages 35–44 and 45–54,” EBRI said in a release. “That likelihood dipped slightly (to 64 percent) among those ages 55–64 and still further (to 49 percent) among those ages 65 and older.”
“The decline in the average amount distributed, as well as the likelihood of there being a distribution for health care claims at older ages, may have been a reflection of fewer people covered by the HSA-eligible health plan as fewer dependent children are covered by older account owners,” said Paul Fronstin, director of EBRI’s health research and education program, and author of the report.
Other findings:
- The average HSA balance at the end of 2013 was $1,766, up from $1,280 at the beginning of the year;
- On average, individuals who made contributions deposited $2,032 to their account. HSAs receiving employer contributions received $1,184, on average;
- Four-fifths of HSAs with a contribution also had a distribution for a health care claim during 2013;
- Looking at HSAs with claims, the average amount distributed for health care claims in 2013 was $1,953.
Input for the study came from data collected from HSA providers with total assets of $2.7 billion as of Dec. 31, 2013. This represents 14 percent of the universe of HSAs and 14 percent of HSA assets, EBRI said.
IRS Urged To Broaden Preventive Coverage In High-Deductible Plans
Originally posted May 9, 2014 by Julie Appleby on https://capsules.kaiserhealthnews.org.
High deductible health plans paired with tax-free savings accounts — increasingly common in job-based insurance and long a staple for those who buy their own coverage – pose financial difficulties for people with chronic health problems. That’s because they have to pay the annual deductible, which could be $1,250 or more, before most of their medications and other treatments are covered.
In a white paper released Thursday, researchers at the University of Michigan say such plans would be more attractive if the IRS broadened the kinds of preventive care insurers were allowed to cover before the patient paid the deductible. Currently, only a limited set of preventive care benefits is included.
“I want the deductibles removed on those things I beg my patients to do,” such as getting annual eye exams if they are diabetic, says author A. Mark Fendrick, a professor of medicine and director of the University of Michigan Center for Value-Based Insurance Design.
If insurers were allowed to offer high-deductible plans that covered “secondary prevention,” such as eye exams, or insulin for diabetics, they would attract 5 million buyers on the individual market, the report projects. Many consumers would see the policies as an improvement over more “bare-bones” coverage, even if the premiums were higher, said co-author Steve Parente, a professor of finance at the Carlson School of Management at the University of Minnesota. At least 10 million in job-based insurance might also switch, some of them from more expensive plans that have limited networks of doctors and hospitals, Parente said. Such plans would be most attractive to those with chronic conditions such as diabetes, asthma or high blood pressure.
“If it is attractive to the chronically ill, it could be a major change,” said Parente. The Gary and Mary West Health Policy Center, a nonpartisan research group in Washington, D.C, funded the report.
Still, such plans would carry premiums at least 5 percent higher than current high-deductible health saving account plans, according to the report.
Whether the IRS would consider changing the rules for high deductible plans connected with health savings accounts is unclear. The agency did not respond to questions. If it altered the rules, insurers would also have to choose to offer the plans.
Currently, more than 15 million Americans have high-deductible plans that can be paired with tax-free savings accounts, called HSA-eligible plans, according to America’s Health Insurance Plans, the industry trade group. Of those, about 2 million buy their own policies and the rest get them through their jobs.
Under federal rules, such plans must have at least a $1,250 annual deductible for singles and a $2,500 deductible for families. Workers can contribute money pre-tax to the special savings accounts to help pay those deductibles. Most large employers offer such a plan as an option and an estimated 15 percent of firms offer only HSA plans or a similar arrangement, called a health reimbursement account, according to the benefit firm Towers Watson.
IRS rules say only primary prevention can be fully covered by the plan outside of the deductible, including such things as routine prenatal and well-child care, some vaccines, and programs to help people lose weight or quit smoking. The rules say such preventive care does not generally include treatments for “existing illness, injury or condition.”
Fendrick and colleagues want the definition changed to allow insurers and employers more options, including allowing coverage of any kind of medical services, including drugs that would prevent complications from or a worsening of a chronic condition, such as diabetes, heart disease or major depression.
“This would be entirely optional for health plans,” Fendrick said. “One plan could [cover] just about everything before the deductible, and another might say they cover five or six drugs, some doctor visits and maybe glucose test strips.”
HSA enrollment jumped in 2013: Fidelity
Originally posted May 7, 2014 by Jerry Geisel on www.businessinsurance.com
Enrollment in health savings accounts continues to surge as more employers are moving to consumer-driven health care plans, Fidelity Investments said Wednesday.
Fidelity said in a statement that the number of HSAs it administered in 2013 jumped to 269,000; up nearly 48% compared with 182,000 in 2012 and a 126% increase over 2011, when Fidelity administered 119,000 HSAs.
“Fidelity continues to drive adoption of its health savings account business as companies and their employees realize their potential advantages both today and over the long haul,” Will Applegate, a Fidelity vice president in Boston, said in the statement.
Numerous surveys have found that the cost of high-deductible consumer-driven health care plans linked to HSAs are less costly compared with other health care plans.
For example, a survey last year by Mercer L.L.C. found that the cost of coverage in CDHPs with HSAs is about 20% lower, on average, than the cost of preferred provider organization coverage — $8,482 per employee compared with $10,196 per employee for preferred provider organization coverage.
That cost difference will become even more important starting in 2018, when a health care reform law provision that imposes a 40% excise tax on health care plan costs exceeding $10,200 for single coverage and $27,500 for family coverage kicks in.