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How To Avoid 5 Common Benefits Mistakes and Create a Competitive Benefits Package

How To Avoid 5 Common Benefits Mistakes and Create a Competitive Benefits Package

December 7, 2022
6
 min read

Your health benefits plan is one of the best tools at your disposal when creating competitive employee compensation packages, improving job satisfaction, and increasing retention. 

However, employers aren’t always on the same page as their employees when it comes to your health benefits package. You may be making incorrect assumptions about what’s most important when choosing an insurance provider and how to support employees after onboarding the plan.

Here are the top five health benefits plans employers make and how to avoid them.

1. Insurance Network Doesn’t Cover Needs

2. High Out-of-Pocket Costs

3. Confusing Cost Structure

4. Lack of Mental Health Benefits

5. Limited Access to Telehealth

Final Thoughts: Top 5 Employee Health Plan Mistakes and How To Avoid Them

Five common health benefits mistakes.‍

1. Insurance Network Doesn’t Cover Needs 

The insurance provider network you choose makes a big difference in your employees’ experience with their plans. If the network is too small, it becomes difficult for employees to get appointments or find specialists. 

If you choose a smaller carrier or plan tier that offers lower monthly costs, that can still result in high out-of-pocket costs if employees have to go out-of-network just to find an available appointment.

That is especially true for teams using remote work setups. Out-of-state employees may not be able to access covered providers at all, which makes their employee benefits minimal. 

How To Avoid It

Look for a national provider as these insurance carriers tend to have larger networks even in their HMO plans. However, if you have a team that’s spread out geographically, consider choosing a PPO plan instead of an HMO. 

If your employees are local and more cost-sensitive, our team at Pebble Health can work with you on finding an HMO plan and creating communications that explain how a smaller network reduces costs.

2. High Out-of-Pocket Costs 

Out-of-pocket costs refer to the cost of care that’s not covered or reimbursed by the insurance carrier. These costs are separate from regular monthly premiums, and they include deductibles, coinsurance, and copayments. 

Many insurance providers have high-deductible health plans that offer lower monthly premiums. But if you have a relatively healthy workforce, their healthcare benefits may not kick in at all. 

For instance, let’s say you have a plan with a deductible of $2,000, but 80% of your employees spend less than $1,500 annually on health care. Ultimately, 80% of employees are paying monthly premiums but receiving no benefits.

How To Avoid It

Survey your employees about their annual health costs before choosing a plan. Pebble Health can help you do this. 

You can also set up Health Savings Accounts (HSA) or Flexible Spending Accounts (FSA) that lets employees use pre-tax income to pay for costs such as their deductible, copay, and coinsurance.

3. Confusing Cost Structure 

Let’s face it. Health insurance costs aren’t always the most straightforward. Group plan benefits can be confusing for employees, making it difficult to predict how much they’re going to spend on appointments or treatments. 

Oftentimes, employees receive medical bills after treatment, and they don’t feel well-informed about what they’re being charged for and why. 

How To Avoid It

Understand that providing an insurance plan is only part of the benefit. Supporting your benefits with clear communications and access to resources like FAQs are also part of your job. 

Take the time to ask your employees what specific questions they have about their insurance plan, and then get in touch with your provider to get the answers. 

At Pebble Health, we help provide continual support so your team members can take full advantage of your health insurance benefits.

4. Lack of Mental Health Benefits

According to SHRM’s 2022 Employee Survey, the percentage of companies offering mental health coverage is now 91% (up from 86% in 2018). 

While the vast majority of companies offer mental health benefits to their employees, there’s still room for improvement. However, much of the power to improve the employee experience lies with your insurance provider. 

The main issues employees experience are: 

  • Insurance plans do not cover many mental health specialists and therapists.
  • Mental health coverage requires a diagnosis and does not allow for making wellness appointments.
  • Some insurance plans limit the number of mental health/counseling appointments (such as once per month).

So, while on paper, it looks as though you provide a good mental health benefits program, it can still be difficult to access in practice. 

How To Avoid It

Make mental health coverage a priority when selecting your group insurance plan. Ask how many specialists and therapists are included in the preferred provider list and clearly understand any possible limitations (such as a diagnosis requirement or appointment limit). 

You can also offer reimbursements for mental health services outside your insurance plan, such as Better Help

If you’re a startup or a small business and can’t fully pay for additional benefits, Pebble Health can help you set up an HSA or FSA that lets employees use pre-tax money to pay for mental health services.

Lastly, create a company culture where employees can talk to HR or managers about mental health and feel comfortable asking questions about accessing these benefits.

5. Limited Access to Telehealth

Interest in telehealth has remained high after the COVID-19 pandemic. It’s an excellent way for employees to receive care with minimal interruption to their work schedules or personal lives. A survey by United Health Group found that 90% of people like the convenience, and even 52% of patients say it’s easier to find appointments. 

Now that people have experienced the work-life balance perks of telehealth, it can be hard to go back to a plan that limits it.

Top benefits of telehealth

How To Avoid It

Choose a plan that offers coverage for a wider range of telehealth appointments. Use internal communications to inform your current employees about their expanded telehealth options. 

Human resources can also facilitate telehealth training for less digitally savvy employees. This way, they can take advantage of flexible care benefits too.

Final Thoughts: Top 5 Employee Health Plan Mistakes and How To Avoid Them

Most employer health plan mistakes happen when you don’t take the time to learn about your employees’ needs and don’t use internal communications to keep employees informed about the health benefit offerings.

That’s why we help you get the right plan from the start and stay on to provide continual support after you’ve been onboarded. If you’re ready to create an employee benefits package that helps you attract and retain top talent, explore Pebble today.

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