Many workers struggle with basic health benefit terms

Many U.S. employees donít understand how their health care coverage works and admit their familiarity with the most basic health care vocabulary needs improvement, according to a survey by Watson Wyatt, a leading global consulting firm.

In its survey of nearly 2,100 covered workers, Watson Wyatt found that a top challenge for 43 percent of workers is understanding what their health care plan covers. Moreover, less than half are comfortable explaining common health benefit terms, such as co-pay or deductible, to a friend or coworker. And fewer than one in four feels comfortable describing health savings accounts, coinsurance and terms such as formulary and center of excellence.

Benefit Term
Percentage of workers
comfortable describing term

Co-pay - 49%
Deductible - 46%
Flexible spending account - 36%
Out-of-pocket maximum - 35%
Lifetime maximum - 27%
Health savings account - 24%
Coinsurance - 22%
Formulary - 16%
Center of excellence - 8%

ìItís hard for employers to ask employees to take more responsibility for their health care when they are not speaking the same language,î said Kathryn Yates, global director of communication consulting at Watson Wyatt. ìHelping employees improve their health care literacy and learn the terminology can make or break a companyís health care efforts overall.î

The survey also found that most employees like to receive communication about their health care benefits in print. When asked to rate several delivery channels, about seven in ten said they prefer print materials mailed to their home or provided at work. Slightly fewer (64 percent) prefer receiving information via the Internet. Less than half (46 percent) favor face-to-face meetings. Interestingly, only a slight a majority (52 percent) of employees read all the materials provided by their employer during the annual health care enrollment process. Three percent do not read any of the materials, and the remainder reads either only what is needed to enroll or only information about changes to the plans.

ìItís essential to communicate with employees in ways that meet their needs and preferences,î Yates said. ìBy using a mix of channels and formats, employers can effectively increase understanding and empower employees to become smarter health care consumers.î