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Many Insured Americans Are Underinsured Through Their Employer-Sponsored Health Insurance

November 21, 2022, by New City Insurance

happy and healthy employees in officeThe national uninsured rate in the US reached an all-time low of 8 percent in 2022, according to the Congressional Research Service. People have put greater focus on their health since the COVID-19 pandemic, resulting in more employees participating in employer-sponsored health insurance plans.

Unfortunately, some employees who receive health insurance through an employer-sponsored plan may still be underinsured. A 2022 Commonwealth Fund Biennial Health Insurance Survey revealed that 23 percent of working-age adults were underinsured in 2022, meaning their coverage did not deliver affordable access to healthcare.

An economic downturn caused by the pandemic has restored attention to health insurance coverage as millions of people struggle to pay their bills. As a result of these economic stressors, more employers are shifting towards custom health plan solutions to reduce costs while improving benefits for employees.

Turbulent Times with Rising Premiums and Stagnant Wages

There are several reasons why so many working Americans remain underinsured, such as rising healthcare costs, public program cutbacks, and erosion of employer-based insurance as well as recessionary conditions.

Today, nearly half of all Americans receive their health coverage through employer-sponsored insurance. However, premiums for health insurance coverage are rising faster than many workers’ wages, causing employees concern about affordability.

A recent survey conducted by the Kaiser Family Foundation found that two in five adults who were enrolled in an employer-sponsored health insurance plan had difficulty affording healthcare or health insurance.

Rising healthcare costs are a primary driver in the increased cost of commercial health insurance. High cost healthcare services, coupled with stagnant wages across many companies, have left many workers with concerning amounts of medical bills and debt.

Millions of Americans Struggle with Medical Bills or Debt

medical bill final noticeAn estimated 41 percent, or around 100 million adults, currently have healthcare debt, ranging from $500 (16 percent) to $10,000 or more (12 percent), according to a Kaiser Family Foundation report.

Adults who are underinsured face some of the highest medical bill problems. A Commonwealth Fund survey found that 51 percent of underinsured adults have difficulty paying their medical bills or reported that they are currently paying off medical debt.

The survey also found that adults who were paying off their medical bills over time and had high deductibles or were underinsured had the largest debt loads.

Fear of More Debt Causing More Americans to Work Through Illness or Health Issues

Research has proven time and time again that there is a direct link between employee health and productivity. Employees who are mentally, physically, financially, and socially healthy are more likely to do their best work compared to employees who are struggling in one or more of these areas.

According to the Centers for Disease Control and Prevention (CDC), the indirect costs of poor health, such as absenteeism, reduced work, and disability, are often several times higher than direct medical costs. In addition, productivity losses due to family or personal health issues cost employers in the US approximately $1,685 per employee each year, or about $225.8 billion annually.

Many employees are also concerned about accumulating more debt. To prevent more financial struggles, many Americans choose to continue working, even while experiencing illnesses or other health problems. In turn, employees feel unhappy, unmotivated, and unable to perform at a satisfactory level in the workplace.

Design an Employee Benefits Package That Protects Your Employees

Designing a comprehensive and affordable benefits package can help employers meet the unique needs of their employees, while also using their budget effectively and creating a competitive offering that appeals to job candidates.

As costs on the retail health insurance market continue to rise, employers are looking for opportunities to lower their healthcare costs while making sure that no employees are underinsured. One alternative arrangement that is quickly gaining popularity across the nation is custom health plans.

Custom health plans allow employers to choose the vendors that build up their health plans, such as the administrator, claims manager, pharmacy benefit manager, and reinsurer. This is compared to the retail model, where all of these vendors are prepackaged. When these components of a health plan are shopped competitively, premiums can be reduced substantially and employees can share in these savings in the form of reduced deductibles, copays, and out-of-pocket costs.

How Custom Health Plans Make Coverage More Affordable

group of people for group health insuranceBusinesses are always on the lookout for new ways to make healthcare coverage more affordable without negatively impacting the health of their workforce. A custom health plan is one strategy that can save companies money without sacrificing employee health.

Custom health insurance plans tend to be more flexible than retail plans. They provide companies with the opportunity to more effectively tailor their healthcare plans to meet the unique needs of their employees and the business.

With a custom plan, businesses only pay for the healthcare services that their employees actually use, meaning there is often money left at the end of the year that can be delegated to other business needs.

Custom health insurance plans allow employees to still get the benefit of a wide network of healthcare providers, including hospitals, doctors, and specialists. In fact, custom health plans are often built on the nation’s largest networks, like the Blues, United, Cigna, Aetna, and Humana.

Investing in Wellness Programs for Preventive Care

Wellness programs play a key role in the long-term health of employees, which can help avoid the need for expensive medications, surgeries,and medical services. Preventive care can delay or even avoid the onset of certain medical conditions that could significantly impact their well-being.

Here are some of the top reasons that all employers should invest in wellness programs for preventive care:

  • Reduce Elevated Health Risk – By adopting healthy behaviors, such as good nutrition and regular physical exercise, employees can reduce their risk of developing chronic diseases and illnesses.
  • Improve Productivity – Employee wellness programs can have a direct impact on presenteeism and increase overall productivity in the workplace. Employees who are physically, mentally, and financially healthy are more likely to do their best work.
  • Better Employee Behavioral Health – Having access to affordable healthcare coverage can improve the mental health of employees, which is essential to a productive and happy workforce.

Make Sure Your Employees Are Covered with a Comprehensive Benefits Plan

businessman opening box with employee benefitsDesigning an employee benefits plan to retain employees and increase productivity can be complicated. However, creating a benefits plan that allows employees to gain access to affordable and comprehensive medical insurance is essential to stay competitive and give back to your hardworking workforce.

As the problem of underinsurance continues, it’s important for employers to develop plans that not only insure their employees but also sufficiently cover them in terms of out-of-pocket costs.

New City Insurance offers long-term cost-saving solutions that allow employees to keep their networks and achieve better coverage while costs go down. We deliver practical solutions across all industries with custom health plan strategies. To learn more about our benefits consulting services or to get started building a custom benefits plan for your company, request a consultation online or contact New City Insurance at 888.210.2765 today.

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New City Insurance
New City Insurance
5.0
Carol Zhang
Carol Zhang
04:29 06 Mar 22
As a rapidly expanding national media organization, the employee benefits strategy and administration that New City has provided us during our growth has been invaluable. They have been proactive about informing us of the different benefit strategies available to us as we grow as well as managing the additional compliance laws and reporting requirements at each stage of our growth.
Claudia Villalobos
Claudia Villalobos
20:14 03 Mar 22
New City Insurance made navigating through all the health insurances super EASY. Their documents are highly informative, professional, and easy to work with. Thank you for making the process of choosing a health plan so simple. You guys are THE BEST!
Philippe Salas
Philippe Salas
17:02 22 Feb 22
I never expected to have a good time talking to an insurance salesman, but let me tell you Brendan was quite the treat. He was very helpful explaining the options and has a wonderful sense of humor. I hope to speak with him every time I call.
Jennifer Polito
Jennifer Polito
17:15 09 Feb 22
Super easy enrollment process. Fast and friendly customer service. If you are looking for an insurance company that is there for you every step of the way I highly recommend New City Insurance.
Rocky Salas
Rocky Salas
23:46 07 Jan 22
So friendly, I hope to speak to him again in all my future insurance needs.
Rocky Salas
Rocky Salas
23:38 07 Jan 22
So friendly and soft spoken. I hope to speak to him again in all my future insurance needs.
Jose Brena
Jose Brena
13:20 06 Jan 22
Eric Calciano has been extremely helpful in finding and selecting the right insurance coverage for our company. With many options out there Eric assisted us on getting a low cost provider saving more than 20% than from our competitors and providing excellent coverage for our employees.
Anastasia Beaverhousen
Anastasia Beaverhousen
17:05 28 Dec 21
Signing up for insurance was quick and easy. Felicity Sundsboe
SFCC
SFCC
22:08 29 Nov 21
Jeff Stoltey and his team provide excellent customer service. Jeff has always provided my company SFCC with straightforward options. I went to a larger insurance company only to RUN BACK to Jeff at New City Insurance. I recommend them to anyone needing insurance without hesitation.
Kevin Luby
Kevin Luby
19:13 22 Oct 21
Quick, easy & informative. We were able to secure quality insurance for our small business on a tight deadline. Thanks for the help New City.
Theresa Ruybol
Theresa Ruybol
19:30 01 Jul 21
Eric was so great with us. He was very patient and kind as we are a newer smaller organization who is growing rapidly. With that said, we had made our inquiry, he had great rapid response and mostly had to wait on me. Any request that we made and/or questions we had, he was great answering and helping us understand. Then when we were ready for all documents and to move forward, Brendan helped with getting that together and the two of them worked their magic on New City's end to notify me of what was needed, assist me in that process and confirming that all was complete and approved for the coverage. I just want to say thank you all again so much, as insurance has always been confusing to me, and you all made that process go a lot smoother.Thank you
Andrea Ordendorff
Andrea Ordendorff
21:06 07 May 21
I've been working with both Clayton and Brendan for well over a year. As the purchase of our dental practice was delayed well over 14 months they both patiently supported me and continued to make themselves available. When we were officially ready to sign up they made the whole process seamless and super easy. This team is highly knowledgeable, professional, supportive, and efficient! I can't thank them enough for everything they've done.
T W
T W
22:32 30 Aug 20
I love New City Insurance. I never had a good experience dealing with insurance brokers until I started working with Brendan. He’s awesome! He is patient with me and takes the time to answer all my questions. I’m very grateful for all his help and hard work!
Mary Jane Deyette
Mary Jane Deyette
00:57 11 May 20
Jeff Stoltey is so awesome...even thru my company had only two employees, he took the time each year to research and find the best plan for us. The only reason I am leaving New City Insurance is because we no longer have any employees. Thank you Jeff
Alma Ortiz
Alma Ortiz
22:25 23 Feb 20
Brendan was awesome! I couldn't figure out how to pick my plan and he returned my call on a weekend to help me. Outstansing service!
jessica kavanagh
jessica kavanagh
19:53 13 Feb 20
Brendan was so helpful I definitely recommend him if you’re in need of good help and getting it done promptly. Thankyou so much again.
Tricia DeYoung
Tricia DeYoung
19:49 13 Feb 20
I was very thankful I inquired about this info. with Brendan. He was very helpful so I understand the benefits available much better now. Thank you Brendan.
B Bayer
B Bayer
17:43 24 Sep 19
NCI handled almost everything from start to finish. Clayton and Brendan made the plans easy to understand and walked me through the application process. They got me my ID numbers before my cards arrived so that I could keep an appointment I had already scheduled. My last broker wouldn't have done that. 5 stars!
Jessica Lehr
Jessica Lehr
03:36 07 Jun 19
Our staff was interested in a health plan, but we didn't know how beneficial a solid employee benefits package would be for our business to expand. We'd lose prospective employees because they had more options for their medical insurance which was sometimes more valuable than more pay. The New City team was amazing and gave us as many affordable options as possible so that everyone had their needs met.
Mike McClay
Mike McClay
19:36 03 May 19
My employer uses New City as their insurance broker, and I'm always amazed when I call in for assistance by how knowledgeable and attentive their staff is with my requests. Their online benefits platform makes selecting insurance plans pretty darn easy. I would highly recommend their services.
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