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Benefits October 28, 2004
Employees: Increased Health Coverage More Important than Pay Increase
October 28, 2004 (PLANSPONSOR.com) - Seventy-five
percent of working Americans would prefer$6,200 in
employer-provided health insurance rather than an equivalent
amount in pay, according to an Employee Benefits Research
Institute (EBRI) survey.
Reported by Kip McDaniel
The seventh annual Health Confidence Survey, underwritten by The Principal Financial Group, reveals numerous statistics that point to the increasing importance of health care benefits for American employees. Regarding employee coverage, employees with coverage are twice as likely to accept lower pay for more health benefits than vice versa. Health coverage is also shown to increase job loyalty, according to the survey, since nearly one-third of those polled said that they stay with their current employer because of uncertainty surrounding other employer’s health coverage plans.
Rising health care costs are also affecting the bottom line for many employees, the poll shows. Forty-eight percent of those surveyed are saving less due to health care cost increases, while 30% have difficulty paying their bills. Over one in four employees claim that they used up all their savings in the past year to meet health care costs. Twenty-five percent said they decreased retirement saving contributions in response to the cost increases.
Workers are responding to calls for reform in their lifestyles to slow down the cost increases, however. Seventy-four percent said that they take better care of themselves to help lower costs, while 58% state that they pay closer attention to their doctor’s orders. Fifty-seven percent only visit a physician in serious situations, according to the survey.
The EBRI survey also shows that health savings accounts (HSA) – an initiative of the Bush administration that would combine high deductible insurance with tax-free medical accounts – are gaining popularity. Eleven percent of respondents stated that they were ‘very interested’ in the new plans, which are available at the beginning of next year. When employer contributions were considered in conjunction with the plans, nearly one-quarter of respondents expressed interest.
A full copy of the survey will be available in the November EBRI Issue Brief, available at www.ebri.org .