Q&A for employers: Help your employees control out-of-pocket health care spending
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Employers have an opportunity to go beyond simply offering their employees good health care coverage. With 1 in 5 insured workers struggling to pay their medical bills,1 it’s important to arm employees with information that can help save them money. There are a number of ways for people to contain their out-of-pocket costs and better control their overall health care expenses.
We sat down with Paul Sharkey, a former benefits consultant who now advises employers for UnitedHealthcare, to learn what you and your employees can do to curtail out-of-pocket spending.
What do we mean when we say “out-of-pocket costs”?
Out-of-pocket costs refer to anything that employees are paying for their health care. That could be a copay at the doctor’s office or a prescription that they get filled at the pharmacy. It could be the deductible that they have to pay if they’re having a more complex procedure, like an MRI or outpatient surgery.
What can employers do to help their employees manage out-of-pocket costs?
If you, as a business owner, offer different health plans, make sure your employees understand the basic trade-off between premiums and out-of-pocket costs – deductibles, copays and coinsurance. The low premiums on a high-deductible plan may seem attractive, but employees need to factor in and be able to cover the deductible should they need anything beyond preventive care. If they can’t afford a $5,000 or $10,000 deductible, then they may be better off paying a higher monthly premium.
Recommended preventive care received in network, like annual checkups, screenings and immunizations, are often included in all plans at no additional cost to employees, even if they haven’t met their deductible. Everyone should be taking advantage of this.
Employers should also encourage the use of telemedicine, sometimes referred to as Virtual Visits, which can be less expensive for both the employee and their employer for most common ailments – like flu or pinkeye. It’s quicker and more easily accessible too. With an online visit, typically over a computer or mobile phone, doctors can diagnose and treat a wide range of non-emergency medical conditions and even write a prescription.
The use of such services is growing fast, and they’re especially helpful for people who live in rural areas and those symptoms that seem to crop up late on Friday night.
Knowing business owners are always looking out for their employees’ best interests, what can they do to help them save money?
The main message employers can have for their employees is, “shop around when needing care.” We don’t shop for health care the way we do for things like a car or a family vacation, and that can be a mistake. For the best prices, encourage your employees to stay in the network. Most people know this but don’t understand that, even within the same network, prices can vary significantly.
Is there really that much price variation between providers?
We see a wide array for the same service. An MRI might be $800 at one location and $2,500 at another location for the same test, even if both are in the network. That’s why it’s so important for people to shop around.
Many insurers, including UnitedHealthcare, make free tools available to members that help do so. For instance, there are apps that will estimate costs for a given procedure in their area. Then there are lists of network providers that can be used to compare quality and cost efficiency and even create a personalized cost estimate based on the chosen doctor, hospital and health plan.
People have more choices about where to seek care these days. How does that affect costs?
We refer to this as the site of care, and it’s a big factor in out-of-pocket costs. We see a big influx each year of people using the emergency room (ER) for routine care. They could save up to $1,800 by choosing an alternative.2 When sudden needs for care arise, but the doctor’s office is closed, people have options beyond the ER.
We already talked about telemedicine, which is great for routine care. Urgent care facilities are another avenue, and they can do 90% of what they do in the ER at about 10% of the cost. Save the ER for real medical emergencies and you’ll likely save time and money.
For details or help with any of the suggestions offered here, please contact your broker or visit uhc.com/employer/small-business
2 *Source 2017: Average allowed amounts charged by UnitedHealthcare Network Providers and not tied to a specific condition or treatment. Actual payments may vary depending upon benefit coverage. (Estimated $1,800.00 difference between the average emergency room visit and the average urgent care visit.) The information and estimates provided are for general informational and illustrative purposes only and is not intended to be nor should be construed as medical advice or a substitute for your doctor’s care. You should consult with an appropriate health care professional to determine what may be right for you. In an emergency, call 911 or go to the nearest emergency room.