As more employers adopt high-deductible health plans, which leave their employees with more “skin in the game,” it’s important that you educate them on how to get the most out of the attached health savings accounts.
Unfortunately, your employees may not be using the funds in their HSAs as efficiently as they should, and they could be leaving money on the table. One of the most common ways that happens is spending those funds on inappropriate care or misdiagnosed afflictions. It’s estimated that up to $1 trillion a year is spent on this type of erroneous care.
The nice thing about HSAs is that they have a threefold tax benefit:
- Money goes into the accounts pre-tax,
- The funds in the HSA grow tax-free, and
- Funds are withdrawn tax-free if used for qualified medical expenses.
Also, funds in an HSA remain in the account. There is no use-it-or-lose-it provision and workers retain ownership of the account even if they switch employers. They also can be kept until retirement and, like an IRA, your staff can roll over or combine HSAs if they have more than one.
But it behooves your employees to learn how they may be squandering the funds they have put into their HSAs.
Examples of unnecessary care
- Duplicate tests, because doctors don’t have access to a patient’s full medical records when they go to two or more treatment centers.
- Overtreatment for common conditions such as back and joint pain, some types of cancer, and stable heart disease.
- False positives from tests, leading to follow-up tests.
- Replacement of less costly gold-standard medications and treatments with new and more expensive alternatives that may not yield better results.
- Care that was delivered on the insistence of a patient when it was not needed or medically appropriate.
Tools for corraling health spending
Fortunately, there are means available to help your employees better decide how to spend their HSA funds.
First and foremost, the majority of medical expenses, like office visits, are reimbursable and the employee should tap the HSA whenever they incur a copay, deductible or outlays for medicine.
Shopping around – If they are told they need a procedure, they can take matters into their own hands and shop around for the procedure among the available treatment facilities in the group network. Doing this can save thousands of dollars.
Second opinions – Getting a second opinion is important, particularly after:
- Receiving a diagnosis of a serious or complex health problem,
- A doctor recommends elective surgery, or
- If the diagnosis is not clear.
Fortunately, many group plans have second-opinion programs as stand-alone services or included as part of an advisory or vendor management program, and through medical centers of excellence.
Objective, evidence-based research – Supplying employees with evidence-based information on treatment options, presented in plain English, can help them understand their options, make more informed decisions, and avoid inappropriate testing and treatment.
It’s also helpful if this resource includes the option to speak with someone via phone or web chat who can answer questions about the information and suggest additional resources.
Referrals to experienced health care providers– Accurate diagnosis begins with connecting employees with the right physicians. The ability to connect workers with physicians who have proven experience and expertise in treating the condition that they’ve been diagnosed with can lower the risk of misdiagnosis and inappropriate treatment.
