The U.S.’s healthcare system has been rapidly changing, and human resource professionals are tasked with complying with new regulations on health benefits and preparing for upcoming trends. Certain health plans are becoming more popular-such as high-deductible health plans and health savings accounts-and staying informed about the growth of these tax-favored health benefits is to HR professionals’ advantage.
Yet, HR departments also have to provide workers with training on certain health offerings and how to be proactive when it comes to receiving cost savings. The Affordable Care Act (ACA) is a complex law to understand, and while HR departments cannot give insight into every aspect of the legislation, informing employees about these benefits should be part of every employee management system.
HR professionals need to know where the health benefits space is in the present, what trends are ahead, and how to successfully prepare for the future of health benefits.
The Shift in Health Benefits
No longer is the employer-sponsored benefits model the standard. There has been movement away from this model to consumer-directed healthcare benefit plans (CDHPs) for some time. According to the Business Group on Health, CDHPs put healthcare decisions into the hands of beneficiaries that is workers-instead of employers, even though businesses still pay for part of care. CDHPs are a way to control healthcare costs more effectively because they are a defined benefit.
According to Healthcare Finance News, CDHPs have been steadily growing in popularity for the past few years. In 2012, 58 percent of companies offered a type of CDHP, with 34 percent providing health savings accounts (HSAs) and 18 percent offering health reimbursement accounts (HRAs).
High-deductible health plans (HDHPs) and flexible spending accounts (FSAs) are other types of CDHPs that are growing in popularity and will continue to be go-to health benefits into the near future.
Because HSAs are tax exempt, it is expected that many employers will turn to these accounts, especially to save money under the ACA, according to Becker’s Hospital Review. HDHPs in particular have already seen increased use within the past few years, and enrollment in these plans have skyrocketed since aspects of the ACA came into effect. According to Business Insurance, the National Center for Health Statistics (NCHS) found 30.3 percent of group healthcare plan participants were enrolled in HDHPs during first quarter 2013, a significant jump from 2008’s 17.1 percent. ACA Watch suggests this number is only going to keep increasing. Use of FSAs is also rising with the NCHS finding 22.8 percent of health plan participants having one in 2013 compared to only 18.7 percent in 2008.
Value of Providing Workers with Education on Health Benefits and ACA
Because CDHPs put more power in the hands of employees, HR professionals need to ensure all workers understand their benefits. Yet, employers can’t stop there-the ACA is going to remain a defining part of the workplace into the future, and workers need to know how the law influences their health benefits. With this knowledge, employees will be better able to be proactive with their healthcare, saving themselves and their employers money. Without it, Becker’s notes employees may not make the correct care choices and see large payment responsibilities that they are unable to pay, negatively impacting not only themselves but their healthcare provider and the industry as a whole.
Employer resources for educating employees about the complexity of their benefits and ACA mandates will be essential this year and coming years. According to ACA Watch, the majority of employers are specifically concerned about employee benefits education, and a survey from the Midwest Business Group on Health found more than 70 percent of employers are taking action to educate workers about health benefits.
HR professionals need to be able to predict and prepare for changes to health benefits. Utilizing human resources solutions can keep HR professionals organized during these changes.