Kaiser Family Foundation 2016 Employer Health Benefits Survey
Historically, one of the perks of working at a big visitor has been generous health benefits with pocket-sized out-of-pocket costs. But increasingly, large companies are offering their employees only i selection: a program with a relatively loftier deductible linked to a savings account for medical expenses.
According to the almanac health benefits survey by Towers Watson and the National Business Group on Health, 66 per centum of companies with 1,000 employees or more than offered at to the lowest degree ane such plan this year. This figure is expected to abound to nigh fourscore percent next year, according to the survey. At nearly xv percentage of companies surveyed, an account-based plan was the simply option — an increment from seven.6 per centum in 2010.
"I do think a lot more than large companies are getting comfortable" with the idea of shifting from a traditional plan to one with a college deductible and a savings business relationship, says Alexander Domaszewicz, health intendance consumerism practice leader for benefits consultant Mercer.
Workers at smaller companies are even more likely to accept coverage through a loftier-deductible health plan with a savings account, co-ordinate to the Kaiser Family Foundation's annual employer health benefits survey. Nearly a quarter of workers at companies with fewer than 200 workers were covered by such plans last twelvemonth, compared with 17 percentage of workers at larger firms.
Switching to this blazon of program may be relatively uncomplicated for smaller firms, since their deductibles in traditional plans are typically higher than those of larger employers, says Gary Claxton, vice president at The Kaiser Family Foundation. (KHN is an editorially independent program of the foundation.)
Matt Grove and his wife, Annie, own a bagel business in Upstate New York. They stopped offering a traditional health plan to their 14 full-time employees final year, leaving in place only a programme with a $five,000 deductible and a health savings account. The change reduced the premiums significantly, enabling the company to trim the amount employees paid for coverage from $173 a month to $43. The Groves deposit about $200 annually into each worker's HSA business relationship to aid cover their medical expenses.
The Groves have family coverage through the same plan. Fifty-fifty though Annie has a heart status and the Groves have to pay for her regular echocardiogram and MRI tests out of pocket up to the $5,000 deductible, Matt Grove says it'due south notwithstanding cheaper than the $12,000 premium they paid annually for traditional coverage.
"We paid for all of that out of pocket, and nosotros nevertheless saved money [last yr]," he says. "It was crazy. The other insurance was just so expensive."
The health-care overhaul has spurred interest in these types of plans, says Domaszewicz. Starting in 2014, most employers take to offer health insurance that is considered affordable (individual premiums that are no more 9.5 percent of income) and adequate (a plan that covers at least sixty percent of immune medical expenses) or face up a penalty.
"Imagine a retailer or a restaurant," Domaszewicz says. "They may desire to offering a very bones plan as a protection that provides the least value that's allowable" without triggering a penalty for inadequate coverage.
"The visitor says, 'Mayhap we'll make that an HSA plan.'"
Under federal police force, the Internal Revenue Service sets the standards for these plans. In 2013, a health programme with a linked health savings account must have a deductible of at least $one,250 for private coverage and $ii,500 for family coverage; among other requirements, the maximum out-of-pocket expense will be $6,250 for an individual and $12,500 for a family.
The coin put into the savings accounts is also limited, just both workers and employers can contribute. The money is tax-free as long as it's used for medical expenses, and it belongs to the worker fifty-fifty if he leaves his job.
About two-thirds of employers that offer health plans with savings accounts put money into those accounts for their workers, according to the KFF survey.
Co-ordinate to the Towers Watson survey, much of the growth in account-based coverage has been in HSA plans, eclipsing an older type of savings account chosen a health reimbursement system, which can be funded only with employer money and belongs to the employer if the worker leaves the job.
In addition to saving companies money, shifting to health plans with college deductibles and savings accounts is supposed to help workers go more cost-conscious in choosing health care. But the extent to which this is occurring is unclear.
An analysis by the Robert Forest Johnson Foundation that synthesized research findings on consumer-driven wellness plans (another term applied to plans with relatively loftier deductibles and a consumer spending account) constitute that, on average, they reduced total wellness-intendance spending by 5 to 14 percent.
The reductions were concentrated amongst healthier enrollees and were mainly due to lower spending on prescription drugs and outpatient intendance. Results were mixed on whether people in such plans cutting back indiscriminately on both necessary and unnecessary intendance, as earlier research has found.
Every bit employers attempt to nudge employees toward healthier behaviors, they're increasingly tying their contributions to employee health expense accounts to healthy beliefs. They may require employees with chronic conditions to participate in health coaching, for instance, or to keep their blood force per unit area and weight within recommended levels, says Sandy Ageloff, a senior consultant at Towers Watson.
At the same time, because account-based plans often expose workers to college out-of-pocket spending, experts say the onus is on employers to give employees information they need to compare cost and quality and make skillful health intendance choices.
"Educational materials are definitely an issue with these plans," says Chiliad. Kate Bundorf, an associate professor of wellness research and policy at Stanford University who authored the RWJF assay. For example, "Price information has been very opaque, and plans are developing tools to bargain with it."
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Source: https://khn.org/news/032613-michelle-andrews-on-high-deductible-plans-and-large-employers/
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