In the battle to curb healthcare spending costs, a new front has emerged: working spouses. A growing number of companies have stopped offering health insurance to spouses of employees if they have access to coverage through their own jobs.
In 2015, 8% of large employers (those with more than 1,000 employees) excluded spouses who had access to other health insurance coverage, according to a 2016 Society for Human Resource Management study.
It makes sense for most employers, who are seeing health insurance rates increase year after year and are faced with developing new cost containment strategies; health plan premiums alone rose about 4% in 2015, according to the Kaiser Family Foundation’s “2015 Employer Health Benefits Survey.”
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The reality is that insuring spouses tends to cost employers more: Spouses spend about $1,179 more than employees each year, according to Employee Benefit Research Institute.
This is at least partly due to the steep expense of pregnancy. An insured spouse is twice as likely to be a woman than a man. It is common for medical carriers to offer healthy pregnancy programs and dental carriers to provide an extra cleaning for pregnant women. Other reasons spousal expenses are higher may be due to general health and age.
One way employers are trying to contain costs is by dissuading spouses from using medical coverage with a spousal surcharge, an added monthly fee for spouses who use medical coverage when it’s offered at their own employer.
Other employers discourage employee spouses by not offering premium subsidies or by offering monetary rewards to employees whose spouses do not utilize the health plan, according to the Kaiser Family Foundation survey.
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Still, many employers realize that offering spousal benefits is a business decision that may affect a company’s ability to recruit and retain employees. As employees carry more of the healthcare burden, they are likely to do more research about insurance options during open enrollment periods and when they switch jobs.
Employers who don’t offer spousal coverage, or significantly penalize employees who do take advantage of spousal coverage, might have a harder time recruiting talent, especially as the job market improves.
For employers who continue to offer spousal coverage, educating employees and their spouses on exactly what a benefits plan includes can help ensure that insured employees are getting the most of the benefits and, importantly, using them the right way.
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Open enrollment is one opportunity for educating employees and insured spouses. Employers can help spouses get the most out of their benefits by creating communications that extend to all insured people after open enrollment ends.
Telemedicine or 24-hour helplines are benefits that can provide cost savings for employees, but they’re sometimes forgotten after the initial benefit selection. Developing emails, brochures or even fridge magnets about these services is a great way to remind everyone that the best option isn’t always the emergency room.
Prescription plans are another area where follow-up education with periodic reminders can help employees and spouses use benefits the right way.
They might not remember that there’s a mail-order option for prescriptions that can save them money for maintenance medicines or that their insurance carrier has a prescription drug comparison option to help choose the best in-network pharmacy.
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Benefits management data can also be used to develop educational materials and create “coachable moments” for employees, based on the latest trends.
For example, if the data shows questions about in-network versus out-of-network doctors, consider developing a communications campaign on the topic of choosing the right physicians for cost-effective care.
Extending coverage to spouses may add costs to the overall health plan, but developing a communication plan directed toward employees and their spouses can help ensure they’re getting the most out of their health and welfare insurance. Offering coverage to everyone in the household also helps with recruiting and retention, and confirms to employees that you’re a family-friendly company.
