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Study: 16% of Workers Remain in Jobs For Health Insurance Coverage

Analysis  |  By Melanie Blackman  
   September 07, 2021

Brian Colburn, senior vice president of corporate development and strategy at Alegeus, spoke with HealthLeaders about the steps that consumers, employers, and payers can take to mitigate this situation.

A recent study conducted by West Health and Gallup found that one in six working adults with employer-sponsored healthcare stay in a job they want to leave, in fear of losing their health insurance benefits.

According to the study findings, "Approximately 158 million people, or more than half of the U.S. adult population, receive health insurance via their own employer or the employer of a household member."

This means 16% of workers who remain in their jobs for health insurance are reluctant to find a new job, because the benefits frequently extend to other individuals in their family.

The study revealed that this fear is most pronounced in Black workers, with 21% of them staying in a job they want to leave in fear of losing their health insurance benefits. Additionally, 16% of Hispanic workers and 14% of White workers are in a similar situation.

Additionally, workers who earn under $48,000 a year are 28% more likely to stay with their job for health benefits, as opposed to 10% of those who earn $120,000 to $180,000 a year.

Brian Colburn, senior vice president of corporate development and strategy at Alegeus, spoke with HealthLeaders about the steps that consumers, employers, and payers can take to mitigate this situation.

This transcript has been edited for clarity and brevity.

HealthLeaders: What can consumers do to get the best of both worlds, meaning have a job they want, while also receiving affordable healthcare coverage?

Brian Colburn: More and more people are getting smarter around the healthcare element earlier in conversations with employers. In the old days, you would wait until you had an offer, and then you would [ask] what type of health insurance [they] offer. It is important to understand where you are in your existing plan and what the new plan is, so you can understand what costs you're going to have to bear in the middle of the year, for example.

Consumers can start to ask questions around the Individual Coverage Health Reimbursement Arrangements (individual coverage HRA) model. A lot of newer companies that are being founded by Millennials are talking about shifting away from group insurance and more to the individual coverage HRA. When you get into that model, it gives you a lot more flexibility as an individual to switch jobs because your health plan goes with you.

A lot of people say, 'it's not going to happen'. My view is the world is always searching for equilibrium. What you see in healthcare, it's far from the natural state, but that is the gravitational pull. Is [the switch to an individual coverage HRA model] going to happen in the next year? Probably not. Is it going to happen in the next 10 years? Almost certainly, because it's hard to defend a system that doesn't make sense given today's more transient workforce. It gives the consumer the opportunity not just to move between jobs, but to get a health plan that's best for you, not the one that's the best fit for the 500 employees at your current company.

HL: What can employers and Payers can do to help consumers in this situation?

Colburn: The best thing that they can do is to help consumers understand the issue of deductibles and mid-year plans and what it means for them. Often, what happens is you don't realize that your deductible starts all over when you start the new job until you get there. It can be helpful in terms of avoiding surprises, but it can be harmful in terms of adding to the financial pressure people feel not to make a move.

For employers, the thing that they could do is offer an individual coverage HRA plan. But the reluctance they're going to have, particularly the big employers, is they're going to view that as a way to make it easier for employees to be more transient.

The question becomes, why won't employers fight this individual coverage HRA plan, why would any of them would adopt it? Here's why I think they will. If you look at retirement, 30-40 years ago, most people had a pension plan. It's a defined benefit because you know exactly what you're going to get. They moved that to a 401k which is a defined contribution [where] the company says, 'I will tell you what I'm going to put in, but ultimately, when you retire, if it's not enough, that's on you as the employee.'

Healthcare is moving in that direction as well. If you look at High Deductible Health Plans, and frankly any plan, more and more of that incremental burden is shifting to the consumer. A lot of employers are saying 'look, I want to get out of the health care business, because I don't know year to year whether my premiums are going to go up by 2% or 10%, and so it's hard to plan.'

In the individual HRA plan model, they can just say, 'look, we're going to give you $12,000 a year to put toward medical insurance, and we're going to increase that $12,000 by the amount of inflation each year. But if premiums go up by 10%, that's on you as the consumer to bear that additional burden.' For a lot of employers, that is an attractive part of this extra model. They have the stickiness, but they get more control over their budget and the cost of health care over time.

“More and more people are getting smarter around the healthcare element earlier in conversations with employers.”

Melanie Blackman is the strategy editor at HealthLeaders, an HCPro brand.


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