How excessive medical plan options can hinder employees’ decision-making
Healthcare is a vital component of an employee’s overall well-being, and selecting the right medical plan can have a significant impact on their life and certainly, finances. However, the process of choosing the best plan is often overwhelming and confusing, especially when employers present employees with a multitude of options through large plan exchanges. This excess of choices and lack of support frequently lead to employees selecting needlessly expensive plans, resulting in excessive costs for both employees and their employers.
Organizations offering a private exchange to employees, hoping the multitude of options is a value to employees, should consider the likelihood that their employees are choosing plans that are needlessly expensive – leading to a negative opinion about the plan offerings that could be avoided with a tailored selection of plans paired with proactive education on choosing the best plan for their family.
Understanding the Problem
- The Paradox of Choice: Large plan exchanges offer numerous options in an attempt to cater to diverse healthcare needs. However, having too many choices can be counterproductive, making it difficult for employees to decide on the best plan for their needs (Handel, 2013).
- Complexity of Plan Structures: Medical plans often have intricate structures, making it challenging for employees to interpret how the plan pays for care. This lack of clarity contributes to the difficulty of selecting the most suitable plan (Bhargava, Loewenstein, and Sydnor, 2015).
Organizations offering a private exchange to employees, hoping the multitude of options is a value to employees, should consider the likelihood that their employees are choosing plans that are needlessly expensive – leading to a negative opinion about the plan offerings that could be avoided with a tailored selection of plans paired with proactive education…
- Information Overload: The abundance of information provided by large plan exchanges can be difficult to comprehend and compare. This information overload can lead to decision paralysis, hindering employees from making informed choices. When employees struggle to understand what a deductible is and under which circumstances they might have to pay it, their view is obstructed in choosing the right plan for their family.
- Lack of Personalized Guidance: General information about available medical plans can fail to offer personalized guidance based on an employee’s specific needs and circumstances. This leaves employees feeling lost and unsupported in their decision-making process.
Empowering Employees to Make Informed Decisions
To help employees choose the best medical plan, RiskPoint works with employers to take proactive measures to provide the necessary support and resources. Below some strategies that RiskPoint has found successful:
- Simplify Information: Present medical plan options in a clear and concise manner, highlighting the key features and benefits of each plan. This will help employees easily understand and compare the available options.
- Provide Personalized Assistance: Offer one-on-one consultations or host workshops to help employees understand their unique healthcare needs and guide them towards the most appropriate medical plan. Personalized assistance can reduce the fear of making the wrong decision and empower employees to make well-informed choices.
- Offer Decision Support Tools: Leveraging technology can provide employees with decision support tools, such as cost calculators and plan comparison charts. These tools can help employees make data-driven decisions and avoid needlessly expensive plans.
- Educate Employees: Prioritize employee education by offering seminars or webinars on healthcare topics and terminology. A well-informed employee is more likely to choose a plan that aligns with their needs, ultimately saving costs for both parties.
The process of choosing the best medical plan is undeniably challenging for employees, particularly when faced with numerous options through large plan exchanges and complex plan structures. However, with proper guidance and support from you and your RiskPoint team, it can become a much more manageable task. By simplifying information, providing personalized assistance, offering decision support tools, and educating employees, employers can help their workforce make informed choices that lead to better healthcare outcomes and cost savings for all involved.
RiskPoint generally does not recommend a large exchange option, even for large employers with multi-state populations. Taking the time to carefully select plans that meet each population’s needs is part of our process and has led to higher enrollment and higher satisfaction with the plan offerings overall. While a private exchange can seemingly find a plan for everyone, many of those plans may not be best for one or more of the employer populations and offering tailored plan options for each location is worth the effort from your RiskPoint team. Engagement with each of your locations is a standard that RiskPoint choses to set for themselves, and we have seen the value it brings to the employees and families we serve over-and-over.
Mandi Roney is a Large Group Benefit Account Executive at RiskPoint Insurance Advisors in Lake Oswego, Oregon. Contact Mandi via email at mroney@riskpointins.com.
