Why insurers need to make it easier for people to use their benefits


Millions of Americans don’t have health insurance—28 million to be precise. But many millions more struggle to access the hard-earned benefits they do have, because those benefits are notoriously—and sometimes intentionally—difficult to use.

First Dollar just released the first round of results from our 2022 Healthcare Benefits Census, research that was conducted by Harris Poll. Harris surveyed 1,000 U.S. adults ages 18 and over who have healthcare insurance and have a flexible spending account (FSA) or health savings account (HSA).

Folks who actually use their benefits, not surprisingly, are happy. Benefit utilization and customer satisfaction (measured by NPS, or net promoter score) are tied at the hip. As for the folks who have a hard time using their benefits, or hardly use them at all? That group is very frustrated.

In particular, there is a clear gap between folks who understand their benefits and those who don’t. Members have a hard time keeping track of their benefits and knowing where to find the information about their benefits, or they simply don’t have the time to look into all of their benefits.

I’ve said it before and I’ll say it again: Most health insurance companies are doing the absolute minimum to educate customers and offer a streamlined solution. This is a huge problem for our industry and system, and if you’re looking to grab market share or make your plan more sticky, there’s no easier way to improve.

By the way, the average NPS score for health plans is 27. In particular, most people don’t like and won’t recommend HSAs, FSAs and other consumer-directed benefits. Negative associations with those products drive down overall customer satisfaction and retention significantly.

A survey by Maestro Health discovered that one-third of employees don’t understand their health benefits. There is a direct correlation between people being dissatisfied with their health plan overall and both having an understanding of the benefits they have and actually using their benefits.

Some companies even make more money when balances go unused or are lost. Annually, $30 billion is wasted on tax-advantaged accounts and supplementary benefits. In 2019, 44% of workers forfeited part or all of their FSA contributions. The average forfeiture was $339, and the median forfeiture was $157.

As an industry, we must do everything we can to help ensure the health and well-being of the people we serve.

People are looking for an intuitive, streamlined healthcare experience. When presented with a single-card solution that streamlined how they would pay for healthcare services, 84% of members said they would be at least somewhat likely to switch to a health plan that offered this solution.

This presents an incredible opportunity for modern, member-driven plans to drive benefit utilization, and in turn, NPS. Unfortunately, the kind of technology-first payments infrastructure needed to innovate in this arena has not materialized, until recently.

Behind most consumer-directed benefits lies a hodgepodge of legacy systems built for a different time. Whether you’re adapting existing plan designs or creating entirely new ones, anyone can sharpen their competitive advantage with software-defined benefits.

But driving benefit utilization to higher levels isn’t just good business, it’s also the right thing to do. Our members work incredibly hard to earn their benefits in the first place. We need to be working even harder for them.



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