More than 8 million people were enrolled in health savings accounts in January 2009, up from 6.1 million in January 2008.
Enrollment in HSAs has been growing steadily since their introduction, from less than half a million people in September 2004. These plans continue to become more popular because the premiums can be lower than those of traditional plans, and members may have more flexibility in how they use funds in accounts such as HSAs and flexible spending accounts.
“As consumer-directed health plans become more mainstream, even more employers are looking at offering these plans,” says David Crosby, regional president of HealthAmerica. “Yet, despite their growing popularity, some may still feel unsure. The key is education, and it’s easier than one might think.”
Smart Business spoke with Crosby about how employers can help ease their work force into adopting and embracing consumer-directed health plans.
What issues do employers face in implementing consumer-directed health plans?
Consumer-directed health care options involve a higher degree of cost sharing with employees. For 2010, the minimum deductible is $1,200 for single coverage and $2,400 for families, in order for plans to be compatible with health savings accounts. These deductibles may be unsettling for employees who have never had deductibles before.
Employees may not be sure what is expected of them or what being a ‘more active health care decision-maker’ is all about. They may be confused and more than a little resistant to change.
How can employers tackle these issues?
An informed and empowered work force will improve the odds that employees will embrace this different type of health plan. Therefore, it’s important that employers take the time and make the effort to explain why they are implementing such measures, and do so early and often.
Sharing information is the key component to effective introduction. Employees may not like what they are hearing, but they will appreciate the explanation about why it is necessary. These products have the benefit of history on their side now. There are a lot of tools and resources available to help.
What messages should an employer be communicating to employees regarding HSAs and FSAs?
Begin by defining health care benefits within the broader context of business. Employees need to understand that rising health care costs will affect the company’s ability to succeed. Let employees know that although their contributions toward health care premiums are increasing, yours are going up even more. Let them know how much more it would be if you didn’t make changes to benefits.
Adopting a policy of ongoing, honest communication can help overcome skepticism, encourage employees to be partners in controlling costs and promote understanding of the changes as a necessary business decision.
What else can employers do to help ensure a successful transition?
Successful consumer-directed health plans are supported from the top. Research has shown that employers who contribute to their employees’ health savings accounts may achieve higher rates of employee participation than those who don’t contribute. Even if it’s a one-time contribution, it’s better than nothing.
Some employers are easing into consumer-directed care by slowly increasing deductibles each year. Others are offering incentives, such as lower premium contributions, to employees who enroll in these plans over the more traditional coverage they also offer.
Creative options that consider the needs of each work force are available.
What are some other tactics employers use to help employees feel comfortable with these plans?
Recognize that this type of plan design represents change for employees in some cases, a significant change. The more prepared they are for the change, the better. Begin a communications effort early and don’t worry about overcommunicating.
Create special but inexpensive communication material just for this campaign, such as employee bulletin boards, newsletters, payroll stuffers, information sessions and your intranet. You may also want to send information to employees’ homes, where it can be shared with a spouse. Encourage two-way communication and invite questions one on one so employees can evaluate their own personal situation. It’s important that they understand all their costs and responsibilities so they are not surprised or discouraged after enrollment.
Emphasize and re-emphasize the connections between unhealthy lifestyle habits such as smoking and obesity and the dramatic impact such habits can have on health care costs. Reinforce the idea of proactively tackling bad health habits now to deter high medical costs later. The message can be as simple as, ‘If you stay healthy, you will preserve more money in your HSA.’
Many health plans offer 100 percent coverage for the cost of approved health education programs such as smoking cessation and weight loss at no cost to the employer.
Finally, stress to employees that they are not on their own after they enroll. Make your human resources staff available to review information and answer questions. Small companies can receive help from their health plans. Health insurers are committed to helping members be comfortable with their decision to choose consumer-directed health care and to be smart users of health care services.
Representatives are trained to educate employees about the process and the decision-making tools available to them.
DAVID CROSBY is regional president of HealthAmerica. Reach him at firstname.lastname@example.org.