Health Care Benefits: 20 Benchmarking Considerations for Your Plan

Health care benefits remain a critical part of the relationship between employers and workers, especially during these times of rapid change and uncertainty. In addition to serving as an important financial safety net, these benefits act as a recruitment and retention tool.

The 2020 Employee Benefits Survey from the International Foundation of Employee Benefit Plans provides benchmarking data on their health care offerings, covered dependents, plan funding, dental and orthodontia benefits, prescription drug offerings and other benefits. Below are some benchmarking takeaways from the survey to help guide your plan decision making.

Health Care Benefits: 20 Benchmarking Considerations for Your Plan

Health Care Offerings

  • Nearly all responding organizations offer health care benefits (98%). The most offered plan is a preferred provider organization (PPO) at 75%. This is followed by high-deductible health plans (HDHPs) with health savings accounts (HSAs) (52%) and health maintenance organizations (HMOs) (26%), an arrangement most commonly offered among public employer respondents.
  • Other frequently offered arrangements include high-deductible health plans with health reimbursement accounts (12%), a point-of-service (POS) plan (10%), exclusive provider organizations (10%), and an HDHP plan without an account (10%).
  • When employers were asked about the plan in which the majority of their workers are enrolled, the most commonly cited were a PPO (50%) and an HDHP with an HSA (26%).
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Covered Dependents

  • Similarly, nearly all responding organizations cover dependents in their plans. The overwhelming majority offer coverage for biological (99%) and adopted (98%) children, opposite-sex spouses (98%), and same-sex spouses (90%).
  • Coverage is also commonly offered for stepchildren (65%), disabled adult dependents (57%), and foster children (49%).
  • Many responding organizations also include coverage of same (43%) and opposite sex (42%) unmarried domestic partners, same-sex partners in a civil union (37%), and common-law spouses (35%).

Health Care Plan Funding

  • Responding organizations use a variety of arrangements to fund their health care benefits. About one in three (31%) responding plans are fully insured. On the other end of spectrum, one in nine (11%) responding plans completely self-fund their health care benefits.
  • The remaining respondents self-fund their benefits with varying levels of stop-loss coverage. More than one in four (28%) respondents self-fund their health benefits with both aggregate and specific stop-loss coverage (28%), followed by self-funding with only specific (20%) or aggregate stop-loss coverage (9%).

Dental and Orthodontia Benefits

  • The overwhelming majority of responding organizations offer dental benefits (94%), a benefit more commonly offered among public sector (100%) and corporate (97%) plan respondents.
  • Far and away, the most provided plan is a dental PPO (80%).
  • The most commonly used deductibles are $50 for single coverage (57%), and $150 for family coverage (41%). About one in five responding dental plans have no deductibles for their single (21%) and family coverage (20%). Similarly, the most common percentage paid by workers for dental coverage is 0% for both single (30%) or family coverage (22%).
  • Those organizations that offer dental benefits were asked if their plans provide coverage for orthodontia. More than four in five (85%) provide orthodontics coverage for children, while 43% provide coverage for adults. About one in eight (13%) responding health plans do not provide coverage for orthodontics.

Prescription Drug Benefits

  • As with health and dental coverage, nearly all (99%) responding corporations offer prescription drug benefits, either as a part of their health plan (87%), or as a separate plan (10%).
  • Survey respondents use a wide variety of cost-management techniques for their prescription drug benefits, most commonly a drug formulary (79%); a mail order drug service, either optional (74%) or mandatory (12%); and the use of a pharmacy benefit manager (PBM) (63%).
  • Prior authorization, utilization management (53%) and step therapy/therapeutic substitution (53%) are all most commonly used by plans to combat escalating costs.
  • From a cost-sharing perspective, plans commonly use three (52%), four (26%), or five or more (5%) tiers.

Other Health Offerings

  • Organizations commonly offer a variety of additional health benefits, including mental health benefits (78%), chiropractic coverage (76%), vision benefits (64%), autism treatments (49%) and hearing benefits (40%). Other frequently offered health care benefits include coverage for bariatric surgery (40%), fertility benefits (30%), pre- (28%), and post-65 retiree health care benefits (23%), genetic testing services (19%), and critical illness/cancer insurance (19%).

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Fertility benefits

  • Fertility medications are offered by three in four (75%) responding organizations that offer fertility benefits. This is followed closely by in-vitro fertilization (IVF) treatments (74%), the process of combining sperm and egg outside the body and placing them inside the uterus.
  • Other offered fertility benefits include visits with counselors, including geneticists and surrogacy professionals (45%), genetic testing to determine infertility issues (38%) and non-IVF fertility treatments (37%). These medications are typically used to help induce ovulation in women who have ovulatory dysfunction or to help women increase the chances for pregnancy in a given cycle.
  • About one in three (31%) responding organizations that offer fertility benefits offer egg harvesting/freezing services. All of these offerings observed a minor, but notable increase in prevalence since the 2018 edition of this survey.

Conclusion

Health care benefits remain one of the most crucial benefits for hiring and retaining great talent at your organization. Where does your organization stand with the 20 benefit options on this list? You can read more about the results of our 2020 Employee Benefits Survey here on the Word on Benefits® blog or find the full report here.

Justin Held, CEBS
Senior Research Analyst at the International Foundation 

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