The jargon used to describe employee benefits can be confusing. A recent study conducted by the Kaiser Foundation Research Institute found that less than 1 in 5 participants in a high deductible health plan (HDHP) understand that preventative office visits are exempt from their deductible. Only 1 in 10 understand preventative tests also are exempt from their deductible.
This misinformation could lead to delaying or avoiding a preventative office visit because of perceived costs, which could lead to more serious and costly health issues down the road. In fact, the study found that almost 25% of the participants who were misinformed, delayed or avoided a preventative office visit, test or screening because of cost concerns. These participants were unaware that preventative care will cost little to nothing out of pocket, and are avoiding care unnecessarily.
What About Consumer Driven Health Plans?
It’s always important to consider employees understanding and experience with health plans when developing CDHP communications. The Watson Wyatt/RAND survey on CDHPs found that employers who communicated early about about a new CDHP had a much higher average penetration rate than those who waited (42% and 25% respectively).
Offering an HSA or HRA along with a CDHP or HDHP can improve employees opinions and perceptions about the plan. It also shows that the employer is sharing costs and responsibility with the employee, helping to take the initial sting out the high deductible. Surveyed employers believed communicating real-life examples of how the plan will cover out-of-pocket expenses was important for employees understanding. The goal of the examples was to explain the difference between preventative care and regular medical care, along with the associated costs and how the HSA or HRA can help to offset the impact of a high deductible.
How do Employee Benefit Statements Help?
Getting the most value out of your company’s HDHP or CDHP comes down to better education and more consistent communication to your employees. Compliment the benefit communications already in place with annual employee benefit statements to fill in the blanks and to show your employees the value of their employee benefits.
Employee Benefit Statement Example
In this example, employees are encouraged to take advantage of regular screenings and check-ups provided for free through the HDHP or consumer driven health care plan. Employees may even be surprised to learn that they can use their health savings account to accumulate savings for medical costs in retirement.
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