Enhancing accessibility and lowering healthcare costs — alongside broadening options and increasing flexibility — are top priorities for employers in Aon’s 2024 U.S. Health Survey. Yet, competing pressures to manage costs while investing in employees make it challenging for employers to find the right balance for their benefits. Annual healthcare enrollment is an area that U.S. employers can proactively address to potentially lower costs while enhancing benefits.
One way to do this is by presenting employees with multiple plan options and carrier choices during annual enrollment. Our experience with Aon’s Benefit Experience is that plan costs decrease when more carriers and plan options are introduced. And when these options are presented alongside decision-making tools, employees are empowered to select the plan that best fits their needs at that point in time.
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94% of U.S. workers surveyed prefer having more choice in healthcare carriers.
Source: Aon research
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“In a traditional, single carrier model, life changes — like when an employee moves — can cause concern around availability and access to providers. Having greater choice in carriers reduces these concerns and leads to higher employee satisfaction.” says Corey Morenz, Senior Vice President and Benefit Experience Practice Leader in North America
More suitable and cost-effective health plan choices lead to enhanced health and wellbeing among employees by ensuring they have access to the plans that are right for them. There are three compelling ways that enhancing the annual enrollment process can achieve cost savings and improve the benefit experience for employees.
1. Improve personal financial decisions
Tools that guide employees toward selecting the right health plan for their circumstances will lead to better overall health and financial decisions. These types of decision-making tools during annual enrollment can guide employees through various inquiries, such as their Health Savings Account (HSA) balance, their capacity to handle unexpected healthcare costs and their total household income. An algorithm within the tools can then incorporate a “capacity to pay” function to take these factors into consideration.
If a high-deductible plan, for example, doesn’t suit a consumer’s financial situation, a decision-support tool such as Aon’s Benefit Experience “Help Me Choose” tool can adjust recommendations accordingly. For consumers who opt for a high-deductible plan, a tool can suggest an appropriate HSA contribution level that aligns with their enrollment. This predictive modeling assists in making informed financial decisions by calculating potential expenses, considering in-plan and payroll deduction costs and out-of-pocket spending.
2. Choose the right insurance carrier for individual needs
Choosing from a variety of health insurance carriers allows plan members to consider the tradeoffs of whether different providers will be in or out of network versus the costs of each carrier. An effective selection tool will also display consumer ratings for each carrier. Together, these enhancements help users gauge customer satisfaction and allow the employee to possibly reconsider choices if a plan has lower reviews.
Additionally, with the introduction of more carriers and plans, employees will have the option to select an insurance provider that aligns with their preferred and trusted doctor, as well as their particular health needs and prescriptions. A good selection tool will take all of these elements into account to help them identify the most appropriate carrier.
3. Make better choices with changing life circumstances
A well-informed employee can personalize their coverage to fit their needs. That could mean selecting an HSA for early investment that can be used for future healthcare needs, richer plan designs while building a family or helping balance medical payroll contributions with other benefits.
Accessibility also plays a big role in healthcare choices. A significant priority for employers is promoting benefits that address healthcare inequalities. More than one in four respondents to Aon’s 2024 U.S. Health Survey said their organization plans to include travel or relocation benefits to facilitate access to medical care that could be statutorily limited or not available in an employee’s home state. Providing a broader choice of insurance carriers can assist employees in receiving necessary treatments closer to home and further reduce employer cost.
Case Study: Adding Flexibility to Health Plan Choice
A food service organization with 6,000 employees across the U.S. had new senior leadership aiming to optimize its current benefit offerings. The leaders wanted to prioritize flexibility in plan choice, enhance the employee experience and reduce administrative complexity of administering benefits — all while being cost-conscious. The solution was to use Aon’s Benefit Experience, which offers multiple carrier options. Introducing more competition drove down the firm’s health plan costs and created more flexibility in plan choice. It also allowed the firm to outsource their benefit administration. Following implementation, the client saved more than $2 million or 6.6 percent on total medical costs.
Enhancing the Employee Value Proposition
Empowering employees with choice and comprehensive guidance in selecting health plans is crucial for improving access and affordability. By offering a range of plans and carriers, along with effective decision-support tools, employers can help their workforce make choices that promote better health outcomes and financial stability.
“Tools that enhance the annual enrollment process give employees the keys to drive their own health care journey. It also helps contribute to an enhanced employee value proposition.” says B.J. Givens, Senior Vice President, Health Solutions, North America