We know you have a lot on your plate as a broker
You wear multiple hats and are pulled in multiple directions, often spanning the entire spectrum of employee benefits – everything from bringing forth options to troubleshooting specific employee issues. However, one constant need is the importance of having ongoing conversations with your clients. To help in your conversations about financial health and wellbeing – specifically health spending and savings accounts, below are three approaches you can use when connecting with your clients:
By helping clients understand their goals and options, you can be the hero
For many, the process of sifting through benefits options and making a selection is daunting. And time consuming. That’s why it’s more important than ever that you use your unique position as an industry counselor to lead your client through the process. First, you need to determine what your client’s ultimate goal is. Some questions to ponder:
- Are they simply looking to save money as health care costs continue to rise?
- Are there other benchmarks that outline what’s most important?
- Are you interested in helping your team members to be better consumers of health care?
- Are you interested in increasing adoption to a high deductible health plan (HDHP) or possibly sunsetting a richer lower deductible plan?
Once the goal is determined, help guide your client to select the plan that is right for their company. For example, if a client says that their number one priority is to save money on health care premiums while still providing a quality plan option for employees, encourage them to explore how switching to a HDHP paired with an HSA helps achieve that goal. Some information resources and statistics about HDHPs:
- Start by walking through how much they would save on premiums cost with a HDHP, as well as what the change would mean for employees. Kaiser Family Foundation reports that the average premiums for covered workers in high deductible health plans with a savings option are considerably lower than the overall average for all plan types for both single and family coverage, at $6,412 and $18,980, respectively.
- Healthcare.gov speaks to employees very clearly stating: “If you enroll in a HDHP, you may pay a lower monthly premium but have a higher deductible (meaning you pay for more of your health care items and services before the insurance plan pays). If you combine your HDHP with an HSA, you can pay that deductible, plus other qualified medical expenses, using money you set aside in your tax-free HSA.”
Speaking of taxes, there are benefits for the employer too. Companies offering a HDHP with an HSA receive FICA savings which are often missed or downplayed. For example, an employer of 50 team members who submit $100/month to their HSA provide FICA savings of $382.50/month or $4,590.00/year to employers. Many times the average contributions are higher, so the greater the team member engagement, the greater the FICA savings.
There is a continual need for employer (and employee) education around HSAs
According to the Kaiser Family Foundation, the average premium for family coverage has increased 22% over the last five years and 54% over the last ten years. With the costs of premiums continuing to rise with no end in sight, now is the ideal time for employers to re-evaluate their educational narrative around HSAs.
Even before the Covid-19 pandemic, we found ourselves in a unique position where employees began to pay more attention to their benefits than they had before—and now more than ever this remains true. According to a recent Further survey, 63% of employees are paying more attention to their health care benefits now versus pre-Covid. This employee mindset shift provides an excellent opportunity for brokers to help their clients shift messaging around HSAs and empower employees to become more educated, engaged health care consumers.
For example, for years brokers have presented HSAs as a long-term savings and investment tool. In fact, 66% of employers today highlight the benefits of an employee HSA plan as being a savings tool, but that’s no longer relevant. Further’s recent survey shows that 65% of employees are spending their HSA dollars now, to pay for care today. Employees are telling us that they are now spending tools. By updating how brokers and employers position HSAs, employees will be better equipped to navigate the health care industry and find the confidence to do so along the way.
You can aid adoption for your clients
Even with the best plan in place, employee adoption can often be a hurdle many companies need to overcome. It’s no surprise that research shows employees tend to delay or disengage from decisions they view as difficult or complex—and what seems more complex to someone outside the industry than navigating health care benefits options? In the 1980s, employees struggled to adopt the 401K, even though it was proven to be the most practical retirement tool on the market. Today, one of the biggest challenges is centered around adoption of HDHPs and HSAs.
To overcome these hurdles, brokers can provide advice to employers on how to actively encourage employees to embrace these tools. Arm your clients with talking points and responses to frequently asked questions that may come up during benefits meetings. For example, while your clients may be on board with HSAs from the employer perspective, they might not instinctually know to explain that HSAs are a fantastic tool for helping employees take control of health care decisions while also saving them money on taxes and building a cushion for future health care costs. Employers are the key to building employee understanding of HDHPs and HSAs, so do everything in your power to equip your client with the most impactful information to share with their team during enrollment time.
Looking for other ways to help aid benefits adoption for your clients? Here are eight tips you can offer your clients during your next benefits meeting. Employers should:
- Educate the client’s company leadership. They can become ambassadors for the rest of the company, and their influence trickles down.
- When explaining benefits, stick to the best- and worst-case scenario model, rather than using examples based on an employee’s status.
- Consider subsidizing HSA plan premiums in the early years of conversion to support enrollment. An alternate funding scenario? Consider funding an HSA on a pre-determined schedule, not up front, but for completing wellness activities in one calendar year, and contributions or matches in the next.
- Help employees commit to regular deposits to their account by offering automatic payroll contributions.
- Make sure employees know that preventive care is covered 100 percent.
- Communicate, then communicate some more. Answer every question and use plain language that’s meaningful and familiar, while trying to avoid confusing industry acronyms.
- Provide cost calculators and other estimation tools so employees can see their numbers come to life.
- Encourage employee dialogue with their doctors by telling them they have an HDHP before making any care decisions, as providers can provide advice based on cost and quality of care.
Your clients are relying on you to help guide them through this process. Make yourself indispensable by building and strengthening relationships by showing that you are here to make their job easier whenever they need assistance. By having ongoing health care and benefits conversations with clients, you’ll be setting yourself up for a successful 2021 and beyond.