Help employees avoid 5 health insurance mistakes, then reap the benefits

During open enrollment, employees usually familiarize themselves with their coverage. But just a few months later, much is forgotten. Even the savviest employees can get confused – and frustrated – with their health insurance. Over time, two out of ten employees regret their benefits decision, according to an online Harris Poll.

Employers can avoid these pitfalls by highlighting plan information in meetings, newsletters, emails and posters throughout the year. As a bonus, communicating about insurance coverage results in two key benefits for employers:

  • When employers communicate about benefits four or five times a year, 85 percent of employees report being extremely or very engaged with their organization as a whole, according to Thomsons Global Employer Benefits Watch 2016/17.
  • Clearing up confusion will help employees appreciate your benefits investment, according to the Society for Human Resource Management.

An effective communications plan can also help employees avoid these five common health insurance mistakes:

Mistake #1 Underutilizing health savings accounts (HSAs).

Employees are easily confused by HSAs. They may not know which expenses are eligible for reimbursement, or they don’t realize they can contribute funds at any time.

To help, point employees to the IRS list of eligible expenses from acupuncture to X-rays.

Next, educate employees about their ability to add extra cash to the HSA anytime throughout the year. For example, after a root canal or a trip to the emergency department, employees can deposit money to pay their out-of-pocket costs.

Mistake #2 Paying too much for prescriptions.

Everyone loves to save money, and understanding prescription coverage can help. If your plan has a mail-order option or a preferred pharmacy, be sure employees know about these economical alternatives.

Also, publicize information about your carrier’s online formulary to help employees choose less expensive options when available. One caveat: Online formularies aren’t always up-to-date. When in doubt, employees should call their insurer’s customer service department for clarification.

Mistake #3 Getting confused about preventive care.

Knowledge is power. Most health plans provide preventive care like routine physical exams, immunizations and screenings at no charge. But confusion about what’s preventive – and what’s not – can cause angst.

There are two key issues:

  • Guidelines change from year-to-year. For example, prostate-specific antigen (PSA) cancer screening was considered “preventive” in the past, but most insurers have removed it based on scientific research. Many doctors still recommend PSA screening, however, which leaves employees footing the bill.
  • Identical services can be either preventive (no-cost) or diagnostic (subject to copayments, deductibles or coinsurance) based on circumstances. For example, a blood glucose test is preventive if the patient doesn’t have any symptoms. But patients with diabetes have the same lab test for diagnostic purposes.

To clear up confusion, provide employees with a link to your insurer’s preventive care guidelines, which outlines no-cost services based on age and gender.

Mistake #4 Getting unexpected out-of-network bills.

If your company benefits plan includes an HMO, it’s essential that employees understand how claims will be processed:

  • When hospitalized, employees should request care from in-network providers when possible. In some cases, an anesthesiologist or another behind-the-scenes provider may be out-of-network even when the hospital is in-network, which means the employee will be billed.
  • For emergency care, health plan copayments or coinsurance must be the same whether the emergency department is in-network and out-of-network, according to the Affordable Care Act. Employees may be balance billed by an out-of-network provider for services, however, and they may be responsible for this bill.

Even employees with a PPO may have surprises. Although PPO plans cover a predetermined percentage of the cost, this payment is based on “reasonable and customary” charges. This could leave employees paying more than anticipated. Read Consumer Reports “The $20,000 Tick Bite” for a dramatic example.

Mistake #5 Ignoring EOBs.

Some employees make the mistake of paying a provider’s bill before reviewing their explanation of benefits (EOB). When that happens, they may inadvertently pay too much.

How to help? Remind employees to take a wait-and-see approach with medical bills. Once the EOB arrives, they can compare it with their provider invoices to be sure the information aligns.

The good news? Many insurers have redesigned – and even renamed – their EOBs to make the information easier to understand. Insurers also provide online member centers, so employees can log into their accounts and review claim details online.

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