Workers Willing to Pay for More Health Care Choices - Brief Article

HR Magazine, Oct, 2001 by Bill Leonard

When it comes to their health benefits, most workers would like to see more flexibility in their employers' benefits plan and say that they are willing to contribute more to health insurance premiums to offset the cost of increased options, according to a recent study conducted by the consulting group Watson Wyatt. The study also found that while many workers favor a defined contribution payment system, they still would like to see their employers administer their health benefit plans.

Watson Wyatt based the study, 2001 Best Practices in Health Care Vendor Management, on interviews with human resource practitioners at 255 employers and survey responses from more than 10,000 workers.

Nearly 60 percent of the employees responding to the survey said that they favor more choice in their medical plans, and approximately the same percentage of respondents also stated that they are willing to share the burden of higher premium costs.

"Allowing employees to choose from a variety of health plans is associated with employee satisfaction, and consumers are now demanding a choice of physicians and treatments," says Steve Richter, a senior health care consultant with Watson Wyatt and co-author of the study. "But employers will need to carefully consider the various implications of expanding employee choice."

As a comparison, only 15 percent of the HR professionals interviewed for the study said that adding more health plan choices is a high priority for their organization. Most of the responding companies also believe that more options would increase their administrative burden, reduce their negotiating power with health plans and create more confusion among employees.

The study also revealed that nearly 40 percent of employees favor and only 23 percent object to a defined contribution model, while 37 percent were undecided. However, more than 90 percent of employees still want employers to manage their benefits enrollment and premium payments.

Bill Leonard is senior writer for HR Magazine.