Employees Unequipped to Seek Lower Health Costs

One in four stay at current job primarily for health coverage

By Stephen Miller, CEBS Jan 13, 2014

When it comes to health care costs, four out of five U.S. consumers indicate they would be comfortable approaching their doctor about the cost of services in order to find competitive pricing. Despite this, fewer than half of consumers have actually asked about the price of care, according to the latest Survey of Consumer Health Care Opinions by the Altarum Institute, a nonprofit based in Ann Arbor, Mich., that provides health systems research and consulting services. The study was conducted among U.S. adults in the fall of 2013, and its findings were published in January 2014.

The size of the health insurance deductible often plays a role in whether a person asks questions about the cost of care. Generally, those with high-deductible plans are much more likely to ask about the price of health care services before visiting a provider.

“It’s a positive sign that people are open to asking their doctors about costs and involving themselves in their health care decisions,” said Wendy Lynch, director of Altarum's Center for Consumer Choice in Health Care and the study’s author. “But overall, the study shows that people still have their head in the sand when it comes to what they think they can control. They have more power than they realize just by asking questions; now they just need to use it.”

Checking Prices Pays Off

Costs of health care services can vary significantly within a local area. In 2012, Change Healthcare's Transparency Index found that a diabetes screening could cost anywhere from $51 to $437 in one community—a 755 percent cost difference—HR Magazine reported. Colonoscopies ranged from $786 to $1,819, and Pap smears cost between $131 and $476.

According to a 2012 white paper by business-information provider Thomson Reuters, if prices for 300 common procedures were reduced to their median price nationwide, total employer medical expenses would drop by 3.5 percent, or $36 billion annually, SHRM Online reported.

Among Atrium's survey findings:

  • Consumers continue to embrace an active role in medical decision-making. People are moving away from the traditional model of care in which they passively accept their doctor's decisions. They continue to place a significant amount of trust and value in the opinions of friends and relatives when making health care choices.
  • Consumers recognize that health care is too expensive but they do not feel equipped to influence the cost. Most acknowledge that health care prices are unreasonably high, and they blame insurance companies, drug companies and the government, but seem conflicted about the role that consumers can play in reducing costs. About half do not believe that they can influence health care prices, but another half believe that consumers have a good chance of improving the affordability of care, such as by choosing less expensive high-quality providers.

    Those who may be contributing most to the cost burden (i.e., consumers who are inactive or overweight or use tobacco) were least likely to accept any responsibility for the cost of care.

  • Consumers face significant financial concerns. The overwhelming majority of consumers worry about their ability to pay for unplanned medical expenses, which may be causing them to forgo care. Additionally, one in four reported staying at a current job primarily for the health insurance coverage.

  • Although consumers claim to be comfortable asking doctors about health care prices, most never do. The almost universal concern about high health care costs does not seem to be translating into more cost-conscious behavior on the part of consumers. Only about half have ever talked with their doctor about prices, even though most maintain they would be comfortable doing so. This trend remains unchanged over the five times that this biannual survey has been taken.

    In general, consumers remain hesitant to seek out information and shop for lower-priced, better-quality care; however, younger patients were more likely to do so.

  • Those who tracked their health care tended to use resources available through their health insurance plan or their doctor. One in 10 consumers used mobile health apps to track items such as exercise and eating behaviors. Younger people were more likely to adopt these technologies.

Retirement Health Care Fears

Retirement is one area in which health care planning is lacking. According to the study, only 5 percent of people are certain that they will have the recommended savings needed to cover health expenses after they retire, while more than 80 percent are either unsure or unlikely to have enough money set aside for health care in their golden years.

The survey also found that most consumers face financial pressures and may be cutting back on out-of-pocket-paid medical care as a result.

Stephen Miller, CEBS, is an online editor/manager for SHRM.

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