Survey: Employees don't want control over health care
Report reveals a sobering gap in employee readiness to handle and take on the shift toward consumer-driven health plans
Original article from https://ebn.benefitnews.com
By Tristan Lejeune
As more and more employers look at defined contribution health care and other insurance shifts, will employees be ready? Last year, J.D. Power and Associates reported that 47% of employers "definitely" or "probably" will switch to a defined contribution health plan in the coming years.
The third annual Aflac WorkForces Report reveals a sobering gap in employee readiness to handle and take on the shift toward consumer-driven health plans and defined contribution health. A majority of workers (54%) would prefer not to have more control over their insurance options, citing a lack of time and information to manage it effectively, while 72% have never even heard the phrase "consumer-driven health care."
Aflac and Research Now surveyed 1,884 benefits leaders and 5,229 wage-earners and found arresting disconnects in their expectations, plans and views of the future. For example, 62% of employees think their medical costs will increase, but only 23% are saving money for those hikes. A full three-quarters of the workforce think their employer will educate them about changes to their health care coverage as a result of reform, but only 13% of employers say educating their employees about health care reform is important to their organization.
"It may be referred to as 'consumer-driven health care,' but in actuality, consumers aren't the ones driving these changes, so it's no surprise that many feel unprepared," says Audrey Boone Tillman, executive vice president of corporate services at Aflac. "The bottom line is if consumers aren't educated about the full scope of their options, they risk making costly mistakes without a financial backup plan."
Aflac reports what many benefits leaders instinctively know: Consumers already find health insurance decisions intimidating and don't welcome increased responsibility. Fifty-three percent fear they might mismanage their coverage, leaving their families less protected than they are now. And significant ignorance remains: Plan participants are "not very" or "not at all" knowledgeable about flex spending accounts (25%), health savings accounts (32%), health reimbursement accounts (49%), or federal or state health care exchanges (76%).
According to the report, 53% of employers have introduced a high-deductible health plan over the past three years, and that trend shows no sign of slowing. Yet more than half of workers have done nothing to prepare for changes from HDHPs, the Affordable Care Act or other system shifts.
"It's time for consumers to face reality," Tillman says. "Ready or not, they are being put in control of their health insurance decisions - and that means having to make choices that could have a big impact on personal finances. If employers aren't offering guidance to workers on how to make crucial benefits decisions, the responsibility lies in the hands of consumers to educate themselves."
The U.S. government estimates that by 2014, household out-of-pocket health care expenses will reach an annual average of $3,301. More than half (55%) of workers have done nothing to prepare for possible changes to the health care system, Aflac reports, and their savings reflect that: 46% have less than $1,000 put aside for unexpected, serious illness or injury. Twenty-five percent have less than $500.
Tillman says that what surprised her most about the data is how people seem to be ignoring such a large, tectonic shift in the landscape. It's not exactly like health care reform has been subtle and creeping.
"There's no greater awareness, no greater education, and it's a sea of change that's taking place," Tillman says. "It's all over the news; it's everywhere. But people aren't any more moved to action and education."
What happens with health care, she says, "seems to be evolving," and there may be a reluctance on the part of consumers to jump in because "hey, it may change." The shift to CDHPs, however, seems to be building in momentum, and employees would do well to wake up. The entire point of that shift, after all, is that they will be on their own, but employers do need to make sure they know that.
Benefits "are a great expense to your organization, and to have your workers and the people that you're charged with protecting not aware, not informed of how the benefits offering could impact their lives, to me that's not really safeguarding a very expensive and important benefit," Tillman says. "It benefits the employee, obviously, to know: What are my benefits, what is my employer thinking about doing, what do I need to be studying. But at the same time, it's very important to employers ... because otherwise they're not getting a very good return on their investment."
Tillman says "frequent communication is paramount" for instituting changes like this - don't send out the message once a year and then forget about it. And never underestimate the value of a personal example as a teaching method.
"A lot of times employers and HR get into a communicate-only-at-open-enrollment mode," she says. "And, even if health care reform weren't about to happen, I'd still say as an HR professional, communicate throughout the year. Communicate via every method that you can - to be sure, at open enrollment, but also on your intranet. If you've got a portal, including things in mailers, the paper tables in the cafeteria. ... the more we can highlight a benefit by showing how other employees have utilized it, that's a really impactful case."
Workers wildly unprepared for health care changes
Original article https://ebn.benefitnews.com
By Tristan Lejeune
The third annual Aflac WorkForces Report, released last week, reveals a sobering gap in employee readiness to handle and take on the shift toward consumer-driven health plans and defined contribution health. A majority of workers (54%) would prefer not to have more control over their insurance options, citing a lack of time and information to manage it effectively, and 72% have never even heard the phrase “consumer-driven health care.”
Aflac and Research Now surveyed 1,884 benefits leaders and 5,229 wage-earners and found arresting disconnects in their expectations, plans and views of the future. For example, 62% of employees think their medical costs will increase, but only 23% are saving money for those hikes. A full three-quarters of the workforce think their employer will educate them about changes to their health care coverage as a result of reform, but only 13% of employers say educating employees about health care reform is important to their organization.
“It may be referred to as ‘consumer-driven health care,’ but in actuality, consumers aren’t the ones driving these changes, so it’s no surprise that many feel unprepared,” says Audrey Boone Tillman, executive vice president of corporate services at Aflac. “The bottom line is if consumers aren’t educated about the full scope of their options, they risk making costly mistakes without a financial back-up plan.”
Aflac reports what many benefits leaders instinctively know: Consumersalready find health insurance decisions intimidating and don’t welcome increased responsibility. Fifty-three percent fear they might mismanage their coverage, leaving their families less protected than they are now. And significant ignorance remains: Plan participants are not very or not at all knowledgeable about flex spending accounts (25%), health savings accounts (32%), health reimbursement accounts (49%) or federal or state health care exchanges (76%).
According to Aflac, 53% of employers have introduced a high-deductible health plan over the past three years, and that trend shows no sign of slowing. Yet more than half of workers have done nothing to prepare for changes from HDHPs, the Affordable Care Act or other system shifts.
“It’s time for consumers to face reality,” Tillman says. “Ready or not, they are being put in control of their health insurance decisions – and that means having to make choices that could have a big impact on personal finances. If employers aren’t offering guidance to workers on how to make crucial benefits decisions, the responsibility lies in the hands of consumers to educate themselves.”
Survey finds majority of employees want customizable benefits
Original article: https://ebn.benefitnews.com
By Tristan Lejeune
As employers increasingly cost-shift benefits, an inevitable consequence is employees wanting a larger say in how their benefit dollars are spent - making tailored and personalized benefit packages another step in the evolution of the consumer-driven paradigm.
"Once you get into the situation where employees now are all of a sudden consumers and [they]'re bearing a fair amount of the cost, with that comes a desire to be able to make a decision," says Mike Fish, vice president of voluntary benefits with The Hartford.
In a December 2012 survey of nearly 1,500 U.S. workers by TNS Omnibus, 86% say it is important to be able to customize all of their benefits to fit their individual lifestyle. Seventy-six percent of those surveyed by TNS Omnibus say it's important for them to design their own disability insurance instead of one-size-fits-all coverage chosen by an employer, and 82% would likely sign up for a disability plan that allows them the chance to choose the size of their payments.
Women and younger workers were particularly likely to favor customizable benefits. Only half of men, but 56% of women, agree that it is extremely or very important to be able to customize benefit choices to fit their lifestyle. Americans in their 40s are more likely to value the option than older workers, and millenials are more likely than any older group to say personalization is important.
"Consumers today can customize everything - from music and TV to clothing and cars, and our recent survey shows they want to customize their benefits, too," Fish says.
Who Knew? Patients’ Share Of Health Spending Is Shrinking
Source: https://www.kaiserhealthnews.org
By Jay Hancock
KHN Staff Writer
Consumer-driven medical spending may be the second-biggest story in health care, after the Affordable Care Act. As employers give workers more "skin in the game" through higher costs from purse and paycheck, the thinking goes, they'll seek more efficient treatment and hold down overall spending.
But consumers may not have as much skin in the game as experts thought, new government figures show.
Despite rapid growth in high-deductible health plans and rising employee contributions for insurance premiums, consumers' share of national health spending continued to fall in 2011, slipping to its lowest level in decades.
"I'm surprised," says Jonathan Gruber, a health economist at the Massachusetts Institute of Technology. "All the news is about the move to high-deductible health plans. Based on that logic … I would have expected it to go up."
True, medical costs are still pressuring families. Household health expense has outpaced sluggish income growth in recent years, says Micah Hartman, a statistician with the Department of Health and Human Services, which calculates the spending data.
But from a wider perspective, consumer health costs continued a trend of at least a quarter-century of taking up smaller and smaller parts of the health-spending pie. Household expense did go up. But other medical spending rose faster, especially for the government Medicare and Medicaid programs.
Economists measure three kinds of consumer health costs: insurance premiums paid through payroll deductions or for individual policies; out-of-pocket costs for deductibles and co-pays; and Medicare payroll taxes. Such outlays fell to 27.7 percent of the health care economy in 2011, down from 28 percent in 2010 and from 32 percent in 2000, according to the national health expenditures report issued by HHS last week.
That's in spite of the fact that one worker in three is covered by a plan with a deductible of at least $1,000, up from one in 10 in 2006, according to the Kaiser Family Foundation. (KHN is an editorially independent program of KFF.) Among small firms, half the workers are now in high-deductible plans.
One factor holding down costs even for families with consumer plans has been patent expirations for expensive, commonly used medicines such as Prevacid and Flomax.
"People these days are spending a lot less out-of-pocket on prescription drugs," said Peter Cunningham, director of quantitative research at the Center for Studying Health System Change. "A lot of that has to do with the shift from brand name to generics."
Nobody thinks consumer-driven medicine has run its course. Insurers and employers are still building tools for patients to shop for care by comparing costs for MRI scans, for example, or researching hospital quality records.
High-deductible plans are expected to win a large share of the business sold next year through the health law's state insurance exchanges. Many companies say they intend to offer high-deductible insurance -- especially plans with tax-favored health savings accounts -- as the only option.
"I've heard of nothing but acceleration" of employers into consumer-directed health insurance, said Roy Ramthun, a benefits consultant who was a senior health policy advisor in President George W. Bush’s administration. "More local units of government, school districts and even some union plans are starting to move more aggressively into these areas."
High deductible plans are already getting credit for helping with an overall slowdown in medical spending growth. Among other factors, economists suspect that the prospect of higher wallet costs has made consumers even more likely than usual to avoid doctor visits in the middle of a sluggish economy. (Public health officials fear this will backfire with a later spike in illness.)
Sooner or later, households’ share of the medical-cost pie will start to get bigger, analysts say. The declines have been getting smaller, suggesting the trend will reverse.
One reason is continued growth of high-deductible plans. Another is that, starting in 2014, the health act requires individuals to start buying coverage or pay a penalty. Another is that federal health spending has risen more than three times as fast as consumer health spending since 2007, which can’t continue.
Even with recent tax increases on high-income households, the huge Medicare program for seniors and the disabled is growing at an unsustainable pace, says Joseph Antos, a health economist at the pro-markets American Enterprise Institute. That means Medicare, too, will need to seek higher premiums, deductibles or co-pays from the patient’s pocket, he said.
"Medicare is on a fiscal slide," he said. "Things are going to have to happen. Eventually, whether you call it premium support or not, we’re going to have to move to some kind of budgeted system in Medicare."
55 billion reasons for consumer-driven care
Source: Benefitspro.com
In a report this week, we found out something we already knew—but probably not to this extent.
Our country’s health care system squanders a ridiculous $750 billion a year. That’s roughly 30 cents of every medical dollar spent. It happens through unneeded care, excessive administrative expenses and data, fraud and other problems, a report by the Institute of Medicine revealed.
Let’s go over some numbers. America spent $2.6 trillion on health care last year. And a third of that spending did nothing to make any of us any healthier. Our health care costs are rising faster than inflation, and it’s literally bankrupting many of us. It’s also killing us. By one estimate, the report says, roughly 75,000 deaths might have been averted in 2005 if every state had delivered care at the quality level of the best performing state.
So what is going on?
The report breaks down the sources of overspending: Unnecessary services tops the list at $210 billion, followed by inefficiently delivered services ($130 billion), excessive administrative costs ($190 billion), prices that are simply too high ($105 billion), fraud ($75 billion) and missed prevention opportunities ($55 billion).
Though we’ve come a long way in health innovation—such as the management of previously fatal conditions—the report said, the American health care system is still falling short on “basic dimensions of quality, outcomes, costs and equity.”
Not that this is news. We know this. It’s apparent every time we see health report numbers or look at our own medical bills.
The question is what we can do about it.
The Institute of Medicine has recommendations: Fully adopt mobile technologies and electronic health records; increase transparency about the costs and outcomes of care; use better data; and move toward a system that rewards doctors for quality, not quantity, of care.
Sure, these are good ideas, but whether they'll happen any time soon is really a mystery. Sadly, it’s out of consumers’ hands.
But preventive care isn’t. There’s something each of us can do—get checked, get necessary and recommended health screenings, eat healthy, exercise, don’t smoke, be proactive about problems—the list goes on. Older people, the report notes, have a big problem with preventive care, and it’s especially problematic because they're more prone to serious and costly health woes.
It’s also worth noting that the report comes at an interesting time. The presidential race is tighter than anyone thought—and health reform and Medicare cuts are sources of major contention. President Obama didn’t even give mention the signature piece of his presidency, the PPACA, during his nomiation acceptance speech at the Democratic National Convention.
Seems like there’s a lot we—and Washington—can do to drastically cut health care costs while also improving care that doesn’t cost another trillion or so dollars to implement.
Want to know what 2025 will look like?
BY KATHRYN MAYER
- Many needs, many models. This scenario is a natural extension of health care as many Americans know it. The scenario forecasts a shortage of primary care physicians, increased emphasis on disease prevention, growth in electronic medical recordkeeping, a shift from employee-based insurance to health insurance exchanges, and growing disparities in access to and quality of primary care based on income and where people live.
- Lost decade, lost health. This scenario forecasts a shortage of primary care physicians, declining income for practicing physicians and more uninsured patients, some of whom resort to black market care and unreliable online advice. Patients with good insurance have access to great care enhanced by advanced technology
- Primary care that works for all. This scenario assumes nearly universal health care coverage, with 85 percent of patients using integrated systems staffed by collaborative teams of health care providers, including physician assistants, nurse practitioners and health coaches who work closely with patients. Seeking to provide better care at lower cost while improving the health of the population they serve, primary care teams join with community partners to address factors that affect a community’s health, including employment, educational attainment, housing, transportation, and access to fruits and vegetables.
- Consumer is boss. Under this scenario, four of 10 patients opt for consumer-directed health plans, which include catastrophic insurance with high deductibles. For the most part, savvy consumers use advanced technologies, including noninvasive bio-monitors, as well as wellness and disease management apps, to stay healthy. Large vendors offer free avatar-based health coaching to consumers who purchase other integrated health products and services. Consumers shop for the best doctor and buy on the basis of high quality and low price.