Employees feel that their employers should play a significant role in ensuring their financial preparedness for healthcare costs
According to a new survey by Alegeus, the market leader in healthcare payment solutions, 66 percent of respondents made finance-related resolutions for 2023 – whether that be saving more (54%), spending less (44%) or sticking to a budget (38%). Of those respondents making finance-related resolutions this year, 78 percent stated that healthcare spending will factor into their efforts.
The survey of 1,018 U.S. respondents also found that 65 percent are at least somewhat concerned about their ability to afford care for themselves or their family this year, and that number jumps to nearly 80 percent when asked about their ability to afford care longer term, into retirement. These concerns stem from various economic factors – like inflation impacting budget (60%) and rising out-of-pocket costs associated with employer health benefits (40%) – that are only fueling continued uncertainties post-pandemic. And yet, few respondents feel they are prepared to manage their healthcare finances this year and beyond, with almost half only feeling somewhat prepared.
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The onus has fallen on employers to provide the necessary tools to help employees address these concerns. According to the survey, 77 percent agree that their employer should bear significant responsibility for supporting them in their financial preparedness for healthcare costs. While respondents say their employers are preparing them to face the financial realities of healthcare through benefits like health insurance (59%) and 401k/retirement plans (49%), they expect more. Only 11 percent said that their employers offered lifestyle benefits – unveiling a largely untapped opportunity. While many equate lifestyle benefits to free lunches and other perks, there are a multitude of lifestyle-based benefits employers can provide – such as healthy living and family care – that directly address the concerns respondents shared.
When asked if they were to set an additional resolution specifically about their healthcare finances, respondents noted improving overall financial health (45%) and protecting themselves from unexpected healthcare expenses and medical debt by building up a savings cushion (37%).
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On the other hand, only 15 percent said they would make tax-free saving/spending a priority by enrolling in a flexible spending account (FSA) or health savings account (HSA), or by taking advantage of an employer-provided health reimbursement arrangement (HRA). This lower number likely indicates a knowledge gap regarding the value of these programs, especially as employees can save upwards of $2,000 per year on taxes depending on their account elections and current tax rate. For example, HSAs, which offer the most significant tax advantages, are still too often under-utilized and under-emphasized by both employers and employees, causing them to miss out on significant savings opportunities that could help them achieve their 2023 resolutions.
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