Open enrollment season is looming, which means that questions about health insurance renewals may start to arise. This time of year provides a perfect window of opportunity for you to help your colleagues reassess their health care needs and present the company’s health care options for next year.
The Potential Pitfalls of Being Underinsured
When employees evaluate their employer-sponsored health insurance offerings, they would ideally look for a plan that fits their medical needs. Instead, many opt for low-premium plans. According to a 2018 Commonwealth Fund survey, 28% of working-age Americans who have health care plans through their employer were underinsured—in other words, their out-of-pocket expenses were too high and their coverage was too low for their circumstances. High copays and deductibles can be financially devastating for families, especially for those who have young children or family members with chronic health conditions that require ongoing care.
So, what drives someone to gamble and pick a plan with inadequate coverage? It generally comes down to affordability. However, when employees get hit with surprise illnesses or injuries, the resulting medical bills can mean that their plan’s low monthly premiums don’t actually save them any money in the long run.
There are buffers to help employees address the unplanned expenses that tend to arise with a low-cost plan. The Kaiser Family Foundation’s 2018 health benefits survey found that 29% of employers who provide benefits also offer a high-deductible health plan that comes with a savings option, either in the form of a Health Savings Account or an employer-created Health Reimbursement Arrangement. Combining one of these with a low-cost plan may not guarantee that employees won’t be underinsured, but it can help manage the costs of extensive or unpredictable medical needs.
Determining Health Plan Needs
Choosing a plan that’s comprehensive enough to avoid underinsurance but affordable enough to avoid paying for unnecessary coverage is a delicate balance. Every year is a chance for employees to assess how their current plan has worked out for them this past year. For example, did this plan cover their family adequately, or have they felt the burden of high out-of-pocket expenses?
Other considerations include how their health was this past year, how often they saw a doctor and how many prescriptions the family had filled—and, importantly, whether they expect their health care needs to change in the near future. Being diagnosed with a chronic illness often means ongoing care and frequent medications. Likewise, planning a pregnancy or nonemergency procedure (like a knee replacement) can necessitate choosing a plan with a higher level of benefits.
Considerations for Employers
As employees mull over their options, the company should evaluate what kind of changes would strengthen their health care offerings. Generally, strategic areas to focus on include:
- Gathering employee feedback received throughout the year about the health insurance plan and their anticipated needs.
- Examining the types of options employees are choosing.
- Analyzing utilization data and upcoming plan premiums.
- Weighing whether next year’s premiums will require an employee contribution adjustment.
- Determining the feasibility of a Health Savings Account.
Education and Communication
To make informed choices, employees need to be aware of their full range of options, understand the differences between plans and know how their choice might impact them financially. Now that you are just a couple of months out from open enrollment, it’s an ideal time to begin the education and communication process and proactively answer any questions employees may have—especially new employees who are navigating the company’s benefit packages for the first time. In a successful benefits communication strategy, companies typically:
- Develop a survey that will guide employees through assessing their health care needs.
- Place fliers on bulletin boards and send out emails to remind employees about open enrollment.
- Develop comprehensive but easily understood plan comparisons, followed by detailed FAQs.
- Schedule employee meetings, workshops or lunch and learn events to discuss available health care options and answer questions.
Don’t hesitate to contact your health insurance carrier for pointers on how to make this year’s health insurance renewals the easiest ones yet. When it comes to dental, United Concordia’s Oral Wellness Consultants provide expert advice to help you customize your enrollments, provide dental benefit training sessions, supply educational materials and much more.
Does preparing your workforce for open enrollment seem intimidating? Make it easy with tips and tricks from United Concordia Dental’s Employer Toolkit.