Health insurance benefits have created an incredibly challenging cost problem for employers. And cost-shifting practices have reached a dangerous breaking point.
One example that hits close to home is the narrowly avoided nurses' strike at Children's Minnesota in June, stemming from union concerns over the rising cost of health insurance. It's a growing trend across the country.
Strikes tend to be the more dramatic and visible demonstrations of employee frustration, but the reality is, employees everywhere are feeling the pain. Sixty-four percent of patients reported that they delayed or neglected care within the past year because their medical expenses would be too high, according to a 2018 survey of 1,000 respondents conducted by 20|20 Research for CarePayment. And 40% of people say paying for health care is more frightening than the illness itself, says a 2018 poll of 1,300 adults by NORC at the University of Chicago and West Health Institute.
Cost-shifting has come in the form of higher premiums and higher deductibles for employees. Today's average deductible is $3,000, yet most Americans don't have $400 in savings to cover medical costs, according to the Federal Reserve Board. And the Commonwealth Fund has found that 25% of today's insured employees are considered underinsured.
It's time to admit it — deductibles don't work.
For the employers out there, I feel for you. Care avoidance is costing your businesses a lot of money too — illness-related productivity loss cost an estimated $530 billion last year, according to the Integrated Benefits Institute. And businesses can't afford to have unhappy employees in today's competitive labor market.
You're in a tough spot. The insurance industry has offered you little support. You've seen basically the same set of products for years — with only cosmetic fixes on top of a broken system. That's why costs have consistently risen.
We are weeks away from 2020 open enrollment. How will you change the status quo? Here are five ways to think differently as you approach health plan selection this year.
1. Seriously consider alternatives to the high-deductible health plan. When employees have coverage on Day One of the plan year, they can actually get treatment when they need it instead of putting it off, getting sicker and missing work.
2. Evaluate the new Health Reimbursement Account ruling and the potential benefits to you and your employees. These structures help individuals take ownership of their health benefits.
3. Make sure employees understand how to determine what is covered and what isn't, so they aren't left in the dark — and make it easy. This may seem obvious, but the process of determining what's covered is often not straightforward, and it's a common source of frustration and surprise bills.
4. Encourage price shopping. Price variation will start to dissipate as people search for and choose affordable services in their market. And remind employees that high price does not equal high quality in health care.
5. Look for plans that give employees choices along their treatment path. When presented with information and options, employees are empowered to decide what's the most efficient and effective option for them — such as trying physical therapy, chiropractic care, or injections to treat knee pain before opting for knee arthroscopy.
We can't keep putting a heavier burden on the backs of employees. And we can't keep pushing off change. Let's all have the courage to try something new.
Tony Miller is the founder and CEO of Bind On-Demand Health Insurance.
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