Benefits and Compensation

Are Employees Putting Their Health and Wealth in the Parking Lot?

Most of us have heard of the “parking lot” in business—the place where ideas not pertinent to a discussion get moved. With the perceived complexity of the health and wealth landscape, as well as the challenges facing employees for the long haul, it’s no surprise that many consumers are moving their health and wealth to the parking lot and only acting when absolutely necessary.

However, with rising healthcare costs—not to mention general life stressors—it’s more important than ever to be proactive with our health and retirement plans.

The good news is that according to the second annual HSA Bank Health & Wealth IndexSM, which shares results from 2,000 interviews on health and wealth engagement, the average consumer remains highly engaged in his or her health and wealth, with an average index score of 62.3 in 2019, compared to 62.4 in 2018.

The index also shows that 71% of respondents are very confident in their ability to manage health needs. In fact, 86% made lifestyle changes to improve their health in the past year.

The bad news is that consumer confidence is not resulting in action.

Consumer Confidence Outweighs Knowledge

We found a significant lack of understanding when it comes to employee health and wealth plans, as well as overall costs.

When asked about health insurance, 15% of consumers were unable to identify their health insurance plan type, while another 3% confused their carrier for their plan type. That’s roughly one in five consumers who is unsure about his or her health insurance plan.

Additionally, 30% of consumers don’t know their copay, deductible, out-of-pocket maximum, coinsurance, or monthly premium amounts.

While the majority are confident in their ability to cover an unexpected medical expense, a total of 40% never actually save for future healthcare expenses.


Take Action

It’s important for advisers and employers to serve as champions and knowledge bearers who help employees make health and wealth improvements easily and effectively.

Adopting actionable tools is recommended to assess and improve the health and wealth engagement levels of employees, with the goal of helping them own their health.

Encourage Prevention

Encouraging positive habits also aids in long-term health and wealth. For example, one of the biggest areas where consumers can improve is the quantity of preventive health exams. The index shows that consumers are doing well when it comes to their annual physical and dental exams, but there is a big opportunity to improve on biometrics screenings and health assessments based on age.

Additionally, many employees don’t realize that preventive health exams are already covered under the Affordable Care Act (ACA) when delivered by an in-network provider, regardless of health insurance plan type. This can help reduce costly trips to the emergency room.

Some employers may offer incentives like adding funds to employees’ health savings accounts (HSAs) so they can utilize their HSA funds for future medical expenses (and any expenses throughout retirement). Based on index findings, those who participate in such healthcare options are most likely to visit the doctor between one and six times a year versus the traditional health plan model, whereby consumers have a more passive approach to health care.

Start Small

Starting small is very important. It is challenging to think about retirement at a younger age, but let’s face it: Medical expenses typically increase with age. According to a study from HealthView Services, a 65-year-old couple will pay $363,946 in today’s dollars for total lifetime healthcare costs—and knowing that is daunting. But taking baby steps helps ensure that health and wealth engagement is sustainable.

One way to help engagement is by offering employees a convenient and tax-advantaged account, like an HSA, to save specifically for healthcare expenses today and in retirement. You can also encourage employees to make regular contributions by implementing a match program similar to a 401(k) plan. Over time, proper saving and investing of HSA funds can also be useful for increasing wealth.

By providing education and resources, we can encourage employees to own their health and proactively take action for happy and healthy lives now and in the future.

Chad Wilkins is the President of the HSA Bank.

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