My co-worker had stopped off at her local Safeway grocery store for some fresh fruit and vegetables. She used her Safeway Shopper card; like many grocery stores, Safeway has a loyalty program that allows its customers to earn discounts based on their shopping habits. However, when my co-worker looked at the bottom of her receipt, where she would typically see a message about how many more gallons of milk she needed to purchase to get a "free" gallon, instead she saw this message:
"Look for the # sign on your receipt for possible Health Care Flex Spending Account items for reimbursement."
Consumer Directed Health Faltering?
A recent article in the Wall Street Journal featured the headline, "Health Savings Plans Start to Falter." The author points to a recent study by the Kaiser Family Foundation about the slower growth in the adoption of consumer-directed health plans and increased dissatisfaction with the plans. However, more and more employers continue to offer consumer-directed health plans. Some employers are phasing out their other health insurance plans in order to defray the escalating costs of insurance premiums.
According to some proponents of the consumer-directed health movement, giving individuals greater control over their healthcare expenditures will help them become wiser consumers. The secondary effect of that is to improve the quality of healthcare, by creating a group of "comparison shoppers" who will hopefully control affect the market and healthcare costs.
How Much Will this Appendectomy Cost?
In the aforementioned Wall Street Journal article, the author notes one major element contributing to the slow growth is "confusion about how the plans are suppose to work." In practice, a consumer has a health insurance with a low premium cost and a high deduction. To offset the high deduction, they can open health savings accounts or "HSAs," tax advantaged accounts by which they can earn interest and save to offset the cost of the deductible.
Unfortunately, consumers are not used to shopping for health care. Under previous plans, you didn't have to stop to ask how much this X-ray was going to cost or if a generic version of that antibiotic might be available at a lower price. Now, consumers are being urged to ask for price lists and check to see what qualifies for reimbursement and what does not.
Back to Safeway
So what, exactly, does this have to do with the note at the bottom of the Safeway receipt?
In an era hallmarked by consumer confusion about what health costs qualify for what kind of reimbursement, Safeway is differentiating itself in the market with an education effort. By highlighting the items on a shopper's receipt that qualify for reimbursement under a standard flexible spending account, they are not only taking steps to educate their customers, but they are also making the reimbursement process easier. Instead of customers consulting the federal governments ever-changing list of allowable expenditures, Safeway cross-checks it for them and notes the allowable purchases. It's easy to see how a consumer unsure about the different aspects of their health insurance may want to do more of their shopping at a store that helps them keep track.
Everyone is paying attention to the trends in consumer-directed health care. Even your local grocery store may have a similar strategy to capitalize on this growing market. And all the indicators point to consumer education as the key to success.
This is where the credit union has a one-of-a-kind advantage. The most important aspect to credit union success is the relationship with the member. Now, more members are looking for trusted sources of information about their health care spending. They're getting information from their grocery store receipts; now is the perfect opportunity to let them know they can get good information from you, too.
There are of opportunities for credit unions with health savings accounts, but first you have to have the set up the back office operations correct. Join us for part three of our series on consumer directed health insurance opportunities, Everything You Need to Know About Operating, Reporting, and Maintaining an HSA Program at Your Credit Union.