COLUMBUS, Ga., June 3, 2015 /PRNewswire/ -- With the
implementation of the Affordable Care Act, more Americans now have
access to major medical insurance. However, results from the 2015
Aflac WorkForces Report released today by Aflac (NYSE: AFL), the
leading provider of voluntary insurance at the work site in
the United States, reveal wide
disparities between higher- and lower-income households in terms of
financial preparedness, knowledge about health insurance and
benefits enrollment. For example, 55 percent of employees in
lower-income households (less than $50,000 in household income per year) are not
prepared to pay for costs associated with an unanticipated serious
illness or accident not covered by major medical insurance,
compared with only 20 percent of employees in higher-income
households (more than $100,000 in
household income per year). This lack of readiness may present
economic and health risks for households already walking a
financial tightrope without a safety net to cope with increased
medical costs.
The online study, conducted by Research Now on behalf of Aflac
between January and February 2015,
surveyed 1,977 employers and 5,337 employees at small, medium and
large U.S. companies, shedding light on how employees at different
ends of the household income spectrum are responding to the
continued high cost of health care and the shift to greater
consumer control over, and responsibility for, medical
expenses.
Families are spending a larger portion of their income on health
care today. Out-of-pocket health care costs, which include
insurance premiums and deductibles, accounted for 9.6 percent of
median income in 2013, almost doubling from 5.3 percent 10 years
ago1 and increasing faster than the rate of inflation
and average raises during those years.
"With wage increases failing to keep pace with rising health
care costs, many employees, especially those in lower-income
households, are one serious medical event away from financial
hardship," said Matthew Owenby,
senior vice president, Chief Human Resources Officer, Aflac. "This
not only has an effect on employees' health and financial
well-being, but it can also reduce their company's productivity
through increased absences and employees who are distracted on the
job."
According to a 2014 Society for Human Resource Management study,
7 out of 10 HR professionals indicated that personal financial
challenges have a large or some impact on their employees'
performance. One-half of the respondents reported that employee
stress (50 percent) and the ability to focus on work (47 percent)
are the aspects of employee performance most negatively affected by
personal financial challenges.2
Varying degrees of financial preparation
The Aflac study shows that 78 percent of employees in
lower-income households have less than $1,000 for out-of-pocket costs associated with
unexpected serious illnesses or accidents compared with 19 percent
of employees in higher-income households. Almost half (49 percent)
of employees in lower-income households have less than $500 for those out-of-pocket costs, seven times
the rate of employees in higher-income households (7 percent), who
have less than $500 for out-of-pocket
costs.
As an indication of the impact unforeseen medical costs could
have, nearly twice as many (41 percent) employees in lower-income
households agree they would be unable to adjust to the large
financial cost associated with a serious injury or illness,
compared to 21 percent of employees in higher-income
households.
"Year after year, the Aflac WorkForces Report consistently shows
that lower-income households remain on the brink of financial chaos
in the event of an unforeseen debilitating injury or illness,"
Owenby said. "It would be difficult, if not impossible, to dismiss
that this quality-of-life issue impacts individuals and employers
in a negative way. Whether a family has major medical coverage or
not, the majority of respondents are unprepared for the financial
burdens that can result from unexpected medical situations."
Less protected by benefits
Employees with lower household income are less likely to take
advantage of job-based health benefits offered through their
employers, leaving them more vulnerable to the adverse impact of
medical costs if faced with a health crisis. For example, the Aflac
study indicates that only 65 percent of employees in lower-income
households who are offered employee benefits are enrolled in major
medical insurance, compared with 81 percent of employees in
higher-income households. In addition, only 1 in 4 employees in
lower-income households are enrolled in disability insurance,
compared with 56 percent of employees in higher-income
households.
Lack of benefits knowledge
The 2015 Aflac study finds that lower-income employees, who are
the least protected against the financial costs of unexpected
medical expenses, may not be taking every step they can to
safeguard their health and financial security. These employees
spend less time researching their options – half spend less than 30
minutes – which could lead them to make hasty benefits decisions
and costly mistakes. As a result, they may have less understanding
of how their major medical insurance works, including newer plan
options that are rapidly being adopted by employers.
- Only 19 percent of those in lower-income households say they
are extremely or very knowledgeable about high deductible health
plans, compared to 37 percent of those in high-income
households.
- Only 20 percent of employees in lower-income households say
they are extremely or very knowledgeable about flexible spending
accounts, compared to 51 percent of those in higher-income
households.
Bridging the health literacy gap
The continued shift of health care costs and control over
medical plans and decisions to employees must be balanced and
supported by access to benefits options, education and resources.
One of the key ways to tackle employees' lack of knowledge about
health insurance, fragile financial conditions and gaps in
enrollment is for employers to improve their benefits
communications. By developing clear, easy-to-understand
communications about their benefits offerings, employers can gain a
better understanding of how to increase employee engagement and
help bridge the health literacy gap in the workplace.
"The Aflac WorkForces Report provides strong evidence that
employees, particularly those in lower-income households, can do
more to protect their financial futures by actively educating
themselves to make sound health benefits decisions," said Owenby.
"At the same time, employers also have significant opportunities to
help close employees' health literacy gaps by providing them with
benefits options that meet their needs and arming them with the
necessary tools to understand and take advantage of the health care
choices available to them."
To learn more about the 2015 Aflac WorkForces, visit
AflacWorkForcesReport.com or follow @aflac on Twitter.
1
|
The Commonwealth
Fund, "State Trends in the Cost of Employer Health Insurance
Coverage, 2003–2013," accessed May 6, 2015 -
http://www.commonwealthfund.org/~/media/files/publications/issue-brief/2015/jan/1798_schoen_state_trends_2003_2013.pdf?la=en
|
2
|
2014 SHRM Survey on
Financial Wellness and Education, accessed on May 1,
2015
|
About the Aflac WorkForces Report
The 2015 Aflac WorkForces Report is the fifth annual Aflac
employee benefits study examining benefit trends and attitudes. The
study, conducted by Research Now, captures responses by 1,977
benefits decision-makers and 5,337 employees across the U.S. To
learn more about the Aflac WorkForces Report, visit
AflacWorkforcesReport.com.
Methodology
Conducted by Research Now on behalf of Aflac, the research
contained two components – employer research and employee research.
The Employer Survey was conducted online within the United States between Jan. 26, 2015, and Feb.
11, 2015, among 1,977 benefits decision-makers at companies
with at least three employees. No estimates of theoretical sampling
error can be calculated; a full methodology is available. The
Employee Survey was conducted online within the United States between Jan. 23, 2015, and Feb.
11, 2015, among 5,337 adults ages 18 and older who are
employed full or part time at a company with three or more
employees and not retired. The first 3,076 interviews were
nationally representative and were weighted as needed to match U.S.
demographics and to enable year-over-year trending, while the
remaining 2,261 interviews were conducted among the top 20 U.S.
DMAs — approximately 100 interviews per DMA. No theoretical
sampling error can be calculated; a full methodology is
available.
About Research Now
Research Now is the leading global online sampling and online
data collection company. With more than 6 million panelists in 38
countries worldwide, Research Now offers a full suite of data
collection services. For more information, please visit
researchnow.com.
About Aflac
When a policyholder gets sick or hurt, Aflac pays cash benefits
fast. For nearly six decades, Aflac insurance policies have given
policyholders the opportunity to focus on recovery, not financial
stress. In the United States,
Aflac is the leading provider of voluntary insurance at the work
site. Through its trailblazing One Day PaySM initiative,
Aflac U.S. can receive, process, approve and disburse payment for
eligible claims in one business day. In Japan, Aflac is the leading provider of
medical and cancer insurance and insures 1 in 4 households. Aflac
individual and group insurance products help provide protection to
more than 50 million people worldwide. For nine consecutive years,
Aflac has been recognized by Ethisphere magazine as one of the
World's Most Ethical Companies. In 2015, Fortune magazine
recognized Aflac as one of the 100 Best Companies to Work For in
America for the 17th consecutive year. Also, in 2015, Fortune
magazine included Aflac on its list of Most Admired Companies for
the 14th time, ranking the company No. 1 in innovation for the
insurance, life and health category. Aflac Incorporated is a
Fortune 500 company listed on the New York Stock Exchange under the
symbol AFL. To find out more about Aflac and One Day
PaySM, visit aflac.com or espanol.aflac.com.
Logo- http://photos.prnewswire.com/prnh/20100423/CL92305LOGO
Media contact – Darcy Brito,
706.320.2358 or dbrito@aflac.com
Analyst and investor contact – Robin Y.
Wilkey, 706.596.3264 or 800.235.2667, FAX: 706.324.6330, or
rwilkey@aflac.com
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/as-access-to-insurance-increases-income-remains-key-factor-in-health-crisis-preparedness-insurance-literacy-and-benefits-enrollment-300093023.html
SOURCE Aflac