HSA and Cancer Care: How to Guide Your Employees
June and the beginning of summer are coming faster than I can believe. June is also National Cancer Survivors Month and it is important during this time that we as employers take a minute to reflect on how we support our employees before, during and after a cancer diagnosis.
Treating serious conditions such as cancer can pose a significant current and future financial challenge for people with this disease. When thinking about paying for health care needs during and after treatment for a serious illness like cancer, most people would think that a traditional health plan such as a preferred provider organization ( PPO) or a health maintenance organization (HMO) would be a better option. than a high-deductible health plan (HDHP) with a health savings account (HSA). However, an HSA-centric plan can be a powerful option for supporting employees in many different circumstances, including those facing a serious medical condition such as a cancer diagnosis.
Because the cost exposures of deductibles, co-payments, coinsurance and out-of-pocket caps on traditional plans have increased so much over the past decade, they may now represent the same or even higher than those of an HSA-qualified plan. Given the relative parity in total costs and the unique attributes that HSAs offer to save and pay for current and future healthcare costs, an HDHP with an HSA may actually be a better alternative for employees, even those with medical conditions. serious as cancer. .
To help employees understand their different plan options and to put them in the best position to meet their health care needs, employers need to help employees understand these different attributes. By focusing on decision support, strong health benefits communications, and implementing a matching contribution strategy, employers can help their employees get the most out of their benefits to save now. and for future medical expenses.
Learn more about HSAs
HSAs are designed to help individuals save for their long-term healthcare needs through investment options and pay for all healthcare costs in the present, while providing triple tax relief. Contributions are tax deductible, or pre-tax if made by withholding, the money grows tax-free and the withdrawals are used to pay non-taxable medical expenses. HSAs also stay with the employee whether they change jobs, need to take extended leave, or retire. Money that is not used is carried over from year to year and, after age 65, can be used for any purpose without penalty – only income tax is assessed if used for non-health related expenses.
According to data from HSA Bank’s Annual Health and Wealth Index, we found that individuals actually have higher rates of engagement in their health care, including preventive care and screenings when they are registered with an HDHP. In 2021, consumers with HDHP had almost 10% higher engagement scores than those with a traditional PPO and those with access to an HSA were 17% more likely than those with a PPO to frequently or occasionally save money. money for future health expenditures.
Decision support and continuing education
However, an HDHP with HSA may not be suitable for all of your employees. This is where employers can help. Decision-support tools, such as comparison tools, can help individuals “do the math” to decide which health plan is right for their needs from a total cost perspective, whether acts as an HDHP with an HSA, PPO or HMO. Guiding your employees by providing them with information that enhances their understanding as well as tools or products for adopting and making health care decisions will empower employees to make holistic health and financial decisions and ensure they understand their insurance benefits.
In addition to decision support, employers need to have strong year-round communication about health care and the benefits they provide to employees (not just during open enrollment). When it comes to cancer screenings, many employees may not understand the difference between preventative care and other medical care and what preventative services might be covered by their plan. According to data from the annual HSA Bank Health & Wealth Index℠, there is a continued lack of understanding and commitment to their health plans across the United States. For example, only 11% of Gen Z consumers reported knowing their health plan’s deductible, and overall knowledge of out-of-pocket maximums was found to be low at just 22%.
Educating individuals about their plan options and healthcare costs is essential so they can make informed healthcare decisions and know how much to save for future medical expenses. It is especially important to ensure employees understand that many cancer preventative services and screenings must currently be exempt from deductibles and that critical illness coverage, and similar top-ups, generally do not invalidate HSA contributory ability. .
Offer incentives and/or matching contributions
Employers can help by offering incentives to their employees to take care of their health before they get sick. This can be done on a wellness basis, for example, offering a $100 incentive for an employee’s HSA to have an annual wellness appointment. Additionally, employers can set up a matching contribution, as many do with 401(k) retirement plans, using formulas such as common 401(k) matches.
Employer contributions tend to increase employee engagement with their accounts and improve the perceived value of their healthcare benefits. This can be particularly challenging for low-income employees, and we’re seeing more and more employers consider making income-based contributions that favor low-income employees who may need extra help paying. health costs under an HDHP.
Role of employers
Although an HDHP with an HSA is not appropriate for all employees, our role as an employer must continue to help make health care more accessible and understandable.
We can do this by:
- Provide decision support tools;
- Have increased and open communication throughout the year (not just during open registration); and
- Offer an incentive contribution and/or HSA matching strategy.
- Embracing even small changes can help boost employee engagement and mitigate
- impact on access to care, particularly for cancer patients and cancer survivors.
Kevin Robertson is Chief Revenue Officer at HSA Bank.