HDHP adoption rates rise, especially among higher-paid employees
- Employee benefits are continuing their shift towards consumer-directed care, according to a Benefitfocus report just released today. The third annual “State of Employee Benefits” report shows that 20% more employers are offering at least one high-deductible health plan (HDHP) compared to 2016, alongside traditional plans to give employees more choices. Benefitfocus, a cloud-based benefits management platform, collected data from 1.3 million of its total consumers at 540 large employers.
- Participation in health savings accounts (HSAs) rose to 81% in 2018, but HDHPs are more attractive to high wage-earners than lower-income employees, who are enrolled in preferred provider organizations (PPOs), according to the study. Premiums will rise, but lower deductibles will offset the cost.
- Additionally, voluntary benefits will meet employees' diverse needs, from serious illness and identity theft (a 56% increase) and pet insurance (80%).
Diverse offerings seem to be driving change in the benefits market, which employers will need to be aware of as they shape and personalize their own plans.
Giving employees the benefits they want and need, while cutting out-of-pocket costs through lower premiums is commendable — and in many ways, necessary to keep both employees and the health plans afloat. But employers must be careful to educate their employees about HDHPs and HSAs, as some may skip out on important preventative care in order to avoid paying down a deductible (even if they have an HSA, meant to cover such expenses).
During GOP attempts to repeal and replace the Affordable Care Act last year, HSAs were targeted by Democrats as better-suited for affluent workers, rather than those that would need the safety net. The results of this survey somewhat bear that out. Employers must see that their array of benefits offer something for workers at every price point and provide safety nets for those who take on HDHPs, including critical illness and accident insurance.
With more choices present in traditional and voluntary benefits, letting employees know what offerings are available and communicating comparison information and price differences will be critical. Many employees don't understand their benefits as well as they think they do or don't know what benefits are available.