First-of-its-kind report looks at data from 500 employers and more than 700,000 employees
Charleston, S.C. – February 16, 2016 – Benefitfocus, Inc. (NASDAQ: BNFT), a leading provider of cloud-based benefits management software, today released its inaugural “Benefitfocus State of Employee Benefits 2016,” a snapshot of real, but anonymous, benefit selection data from more than 700,000 people at 500 large employers. The in-depth study, which used actual behavioral data rather than self-reported data analyzed in typical surveys, shows that 52 percent of large employers on the BENEFITFOCUS® Platform now offer high-deductible health plans (HDHPs). This is illustrative of a larger trend: companies are altering their plan design to shift greater financial responsibility to employees, driving the need for a different approach to health care consumption.
One of the most significant findings was that millennials—born between 1980 and 1989—selected HDHPs more than any other age group. However, while approximately 44 percent of employees in this group chose HDHPs, a much smaller number of these employees took full advantage of health savings accounts (HSAs), leaving a significant amount of tax-free money on the table that could offset high deductibles.
In addition, the report found that large employers on the Benefitfocus Platform should be well positioned to navigate the Cadillac tax to be levied on higher-cost health care plans in 2020 under the Affordable Care Act. Total premiums across all 2016 plans averaged $14,974 for family coverage and $6,096 for individual coverage—both well below the tax’s respective target thresholds of $27,500 and $10,200.
Potentially crucial voluntary benefits are also lacking among large employers. Critical illness, hospital indemnity and accident insurance are common products that can give employees—particularly HDHP participants—added financial protection when they encounter unexpected medical expenses. However, only 36 percent of large employers offered such voluntary benefits for 2016, and only 14 percent of employees actually enrolled.
“This report marks a new era in employee benefits. With sophisticated enterprise benefits management systems like the Benefitfocus Platform, we can now draw meaningful insights from actual employee behavior,” said Shawn Jenkins, Benefitfocus CEO. “This is a quantum leap forward for CHROs, CFOs, administrators and all of us working to turn benefits into a strategic asset. This report provides a road map for policymakers looking to expand health care coverage while controlling costs.”
Large employers, insurance carriers and brokers are gathering in Orlando, Florida, March 8–10, for the annual Benefitfocus user conference, One Place, where they will discuss the report findings and implications for the future of benefits strategy.
The “Benefitfocus State of Employee Benefits 2016” report analyzed anonymized benefit selection data from Benefitfocus’ data warehouse. This report includes data from over 700,000 records across the Fall 2015 open enrollment period from 500 large employers, all with 1,000 or more employees.
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