Listening to Consumers: Values-Focused Health Benefits and Education

January 2008
EBRI Issue Brief #313
Paperback, 24 pp.
PDF, 792 kb
Employee Benefit Research Institute, 2008

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Executive Summary

Importance of education in consumer-directed health plans: Greater education of workers about health care and health insurance is widely viewed as critical to the success of consumer-directed health plans, since these rapidly growing health benefit plans typically require far greater responsibility and impose more direct costs on individual health plan participants.

How can employers educate their workers about health coverage? Is there a payback? Since the vast majority of Americans who have health coverage obtain it through their (or a family member’s) employer, and with health benefits on track to become the single-largest expense of any employee benefit, the issue of education is important both to the sponsors and the beneficiaries of health insurance coverage. Among the key questions facing employers: What kind of education will work? And is there a payback for trying to educate workers about health coverage and care?

“Top-down” efforts to control costs haven’t worked for long in the past. Trying to “activate consumerism” by promoting consumer-directed health plans seems little different from past managed care attempts to stem out-of-control health costs by changing consumer behavior. But past (and current) “top down” approaches, structured without a better understanding of what consumers need to know and what they value, are likely to be ineffective over time. There is no research consensus that consumer-driven health benefits alone will contain health care costs.

Importance of consumer values: As marketers have known for years, consumers’ values are the powerful motivators in the psychology of decision making. They involve people’s perceptions about what constitutes life quality, reflect deeply held cultural and personal meanings, vary in importance from person to person, and they can appear to others as irrational and vague.

The need for values-focused education and wellness outreach: In order to inspire consumers to choose healthy lifestyles and make cost-effective care decisions, they need help resisting some entrenched unhealthful dimensions of American culture and education that takes their psycho-social and income-security concerns into account. But consumers have little or no input into the “consumerism” discussed among policymakers and employers today, and few are receiving health education that addresses their psycho-social and income-security concerns.

“Consumerism” in health care risks failure by ignoring consumer values. Should health education initiatives prove ineffective, the “consumer-driven health movement” could well be doomed, especially if it relies upon fully educated health consumers taking self-initiated actions. The perceived ineffectiveness of education in 401(k) plans resulted in legislation to add “defaults” to these plans so that they no longer relied upon positive employee action. In the health arena, the default approach is exactly what the consumer-driven health model seeks to move away from.