As the saying goes, “You can lead a horse to water, but you can’t make him drink.”
Small to mid-sized employers can offer health insurance, but many employees don’t sign up or, even if they do, they don’t value it or use it.
To help companies understand why employees may not be signing up for health insurance and offer tips to increase participation rates, we sat down with Robert Horton, who’s advised many small business owners on health plans during his two decades at UnitedHealthcare, to discuss this topic. He’s joined by Mike Matheny who, with his partners, runs FolkloreDigital, a Minneapolis-based digital marketing agency. We asked them how small businesses can help their employees value and use the health insurance they offer.
Why don’t all employees sign up for the health insurance their companies offer?
Robert Horton: Sometimes, an employee’s spouse will be covered by a plan at their job, so they’ll enroll in that instead. The other factor is cost. Some people think, “It’s just too expensive for me, so I'm not going to have the insurance.”
What kind of impact can that have?
Horton:The financial consequences can be serious. An accident like a broken leg could cost up to $7,500, while two or three days in the hospital could be in the $30,000 range. That’s a lot of money for someone to come up with out of their own pocket.
How does this shape the type of plans an employer might offer?
Horton:The Affordable Care Act allows young adults to stay on their parent's plan until they turn 26 years old. As it relates to demographics of the group in total, that could have an impact on what business owners want their funding strategy to be.
For example, if you have a very young demographic makeup, you might want to consider self-funding because that might be a better option for you. But if you have a very mature workforce, you might be better off in a fully insured writing environment.
Mike, how did you decide what to offer at your company?
Mike Matheny: In starting a business and looking at the costs that go into that, my partners and I had different circumstances. I had one partner who was going to have a baby literally a month after we started. Another was a single 25-year-old who didn't care about insurance whatsoever. The third was already established in a plan. It was difficult when we started to look for what was going to work for us. We had a lot of discussions.
As we have a wide range of employees, from kids that are just out of school to some of us who have been doing this for 20 years, we offer a fully insured plan. But a lot of our young employees are still on their parents’ insurance.
What do employees like about health insurance?
Matheny: They like being able to use the doctor they want to use, annual checkups, wellness programs and having their kids covered.
Horton: There are some other tools being introduced by carriers that people like. For example, the ability to price what it will cost to go to a certain provider and have a procedure done. Also, virtual visits are very popular, especially with the younger generation. They can see a physician on their mobile phone and get treatment for a large number of minor issues without having to spend time going to a physician’s office.
How can business owners boost participation in their health plans?
Horton: Promote the value of that benefit plan for employees and their family members. Health care is expensive and it's good to have the safety net to help cover those costs. Also, small employers can be more transparent in what they're paying. It's important for people to know that their companies are paying the bulk of the cost of the health benefit.
Matheny: I agree with that 100%. We are relatively transparent in our cost, what it is and the benefit to employees. Communication is important.