For TPAs who offer HSA administration services, understanding HDHP enrollment and wellness program participation can be key when talking to clients and prospects. This article outlines the link between HDHP insurance and wellness programs.
As the cost of healthcare premiums continues to rise, more employers are turning to high deductible healthcare plans (HDHPs) as a way to lower premiums and shift more of the cost responsibility to employees. According to Health Payer Intelligence, more than half of U.S. employers currently offer HDHP coverage in addition to a traditional healthcare plan.
Despite paying higher deductibles, many employees seem to like HDHPs as well. A survey conducted by Benefitfocus reported that when given the choice to select HDHP coverage, 41% of employees do so. The latest figures show more than 20 million employees currently enrolled in HDHP plans.
An HDHP helps employers lower their premiums by requiring employees to pay a larger share of their healthcare costs. However, with a qualified HDHP, employees can offset the higher costs by enrolling in a Health Savings Account (HSA); an HSA saves them money on taxes while helping cover their out-of-pocket medical expenses. In addition to the HSA benefit, HDHPs are also increasing employee participation in wellness programs.
Wellness Programs Create Healthier, Happier Employees
Wellness programs are designed to help employees make better lifestyle choices in order to improve their health. They represent a key element in a broader movement to control healthcare costs by getting people more involved in the selection and utilization of their healthcare services.
To encourage better health, wellness programs have many different components. They include weight-loss, stop smoking and diabetes management programs, as well as regular preventive health screenings. They also encourage people to engage in regular physical activity.
Many employers offer cash, discounts on products and services, gym memberships and other rewards to encourage employees to enroll in their wellness programs. In cases where employers do not offer wellness programs, they are often provided by the HDHP insurance plan.
Benefits of wellness programs to employers
- Reduced healthcare costs
- Less absenteeism
- Increased productivity
- Healthier, happier employees with higher job satisfaction
Benefits to employees
- Better health
- Opportunity to interact with co-workers away from the office
- Stress management
- Reduction in medical expenses due to improved health
The Impact of HDHP Plans on Wellness Program Enrollment
HDHP insurance requires plan participants to pay higher deductibles than with traditional plans. Accordingly, HDHPs encourage people to become more aware of their healthcare costs; with more financial awareness, people start looking for ways to reduce their expenses. Wellness programs offer a very effective tool for lowering costs.
In 2016, EBRI/Greenwald & Associates conducted a survey to measure consumer healthcare engagement with three different wellness programs – biometric screening, a health-risk assessment, and a health-promotion program focusing on a specific health issue.
The survey found that employees with HDHP coverage were more likely to research cost information for healthcare services than those with traditional health plans. They also had a higher participation rate in wellness programs, and were more aware of employer-offered incentives.
For employers looking to increase employee satisfaction, boost program participation, and control their premium costs, an HSA-eligible HDHP with a wellness program can be part of the solution.
DataPath HSAToday is full-service HSA platform for account administration, investing and deposits that simplifies HSA management for TPAs.