CDHDs & HSAs. "There is just one fatal flaw with this picture that is keeping employees from getting the health care they need."
I only see one major medical insurance carrier doing this any more in Southern California, but they all used to require any agent getting appointed to sell their insurance to vow, in writing, not to add supplemental onto their plans. Why? They were trying to sell their more expensive platinum plans to employers that covered everything. Some of us vaguely remember 1st dollar coverage, right? If supplemental gap insurance was offered to an employer, they would figure out that they could save a lot of money by going with the least expensive high-deductible plan, covering the employee’s deductible with inexpensive gap insurance.
Oh how times have changed. With the underlying health care costs out of control, premiums became out of reach for most employers, who then insisted on the least expensive, consumer-driven, high-deductible plans, adding on an HSA. And here we are.
There is just one fatal flaw with this picture that is keeping employees from getting the health care they need. Americans aren’t saving. I’m not here to point fingers or assess blame, it’s just our current reality. The personal savings rate in America is around 4.4 percent, which is a huge fall from 2012’s 10.5 percent. Almost half of Americans would not be able to cover an unanticipated expense of $500, and almost a quarter wouldn’t be able to cover even $100. Yet today's deductibles can reach as high as $10,000 before insurance kicks in.
"The personal savings rate in America is around 4.4 percent, which is a huge fall from 2012’s 10.5 percent."
Given this reality, gap insurance is now a necessity. Most major carriers realize this and have stopped requiring agents to sign a promise not to partner CDHDs and gap insurance. In fact, most of them are now offering supplemental insurance as well. I’m just curious why it still seems to be hush-hush. Why isn’t the administration, in pushing CDHDs on the ACA exchanges, and preaching consumer-driven health care for all, speaking about the necessity of gap insurance, while Americans adjust to saving for high-deductibles? It needs to be shouted from the mountaintops. Right now, I’m in the Rocky Mountains of Colorado for the Labor Day weekend - so that’s what I’m doing. Have a safe, healthy and enjoyable holiday. When you get back to work, make sure your employees, whose labor you value, have access to gap insurance as part of your benefit offerings so they can access the health care they need to keep being productive for your business.
Source: Lake, R. 05/18/2016. 23 Dizzying average American savings statistics. Retrieved 8/30/16 from: https://www.creditdonkey.com/average-american-savings-statistics.html
Rylan Klaseen & Associates
Rylan Klaseen & Associates
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