HSA = Health Sadly Absent
August 27, 2012 9:02 AM   Subscribe

What's the best way to sell my company on getting better health insurance?

I recently switched jobs after receiving a very nice offer from another company. I didn't ask for insurance details before signing on because I figured as well-established tech companies go, insurance varies only in the details.

A week in, I got the details, and I'm floored by how terrible it is. It's a high deductible ($225/month) HSA with no employer contributions and covers the basics. No prescription drug coverage, which is the only thing I really need. The HR rep innocently said many people buy their own third party insurance; I should ask around for suggestions.

The company has been around 10 years and is making excellent profits. Am I spoiled in thinking its fairly paid employees deserve better insurance? What do I do (and how do I do it effectively) to get the right people thinking about switching? Half the company is in Austin (where I work), but the other half is the part with people who have decision-making powers: administration, the HR lady, etc. Those people have a separate insurance setup of unknown quality. The CEO occasionally flies over to see us, so I may have his ear at some point.
posted by spamguy to Work & Money (9 answers total)
Lesson learned, evaluate ALL aspects of the benefits and pay package prior to accepting new offers.

You can suggest a new insurance, but trust me on this, they're not interested in doing anything but providing the bare minimum of insurance at the smallest possible cost.

The healthier employees will prefer this type of plan, rather than a more expensive one, because they like having a few more bucks in their paychecks.

My suggestion is to start looking for a new job with better benefits. That's about the only way you'll get what you want out of this arrangement.

Vote with your feet.

If everything else is good, then do look into ancillary insurance (many companies will provide you with a small amount if you decline their insurance, in favor of private insurance.)

If the CEO is from a country with good health insurance, He may or may not even understand how the quality could be lacking. If it's appropriate, you may want to mention this to him, but I doubt seriously that he cares all that much.

HR people received bonuses by keeping costs down. If there is high turnover, and if it affects the bottom line, THEN you may have an arguement. But typically, these things are not tied out , (Number of people leaving due to shitty insurance adding to the cost of recruiting and training new hires vs. cost of retaining existing hires through more expensive insurance).

Unless you want to tilt at that particular windmill, either shore up your existing plan with other insurance, or leave. You know why beating your head against the wall is so worthwhile? Because it feels great when you stop.
posted by Ruthless Bunny at 9:15 AM on August 27, 2012 [3 favorites]

I believe it is illegal now according to the PPACA to offer certain tiers of employees a better health plan than others, and that a company can only have two separate plans as long as they're both presented as options to every employee. (I do a bit of HR at my (small) company, and this is how it was presented to me by the outside broker we have sourcing our insurance plans.)

Go ahead and ask HR for the EoB and employee/employer contribution details for the other plan used by the company. If it's a better plan, ask to be on it. See what happens.
posted by phunniemee at 9:20 AM on August 27, 2012 [4 favorites]

Yikes, yikes, yikes. It is so unfortunate that they didn't inform you before you accepted their offer. This is the thing I hate most about employer-sponsored health insurance is this exact problem: there is no way to truly compare offers between companies.

But to answer your question: I personally know of two companies that voluntarily switched from cheapy throwaway plans to a more-expensive one for all employees. In both cases, they were small companies and a highly-valued employee (e.g., owner or a relative of owner) got cancer and they discovered how truly awful the plan was.

That they don't contribute anything at all to the plan is crazy. Do they make deposits into your HSA for you, anything like that? Or is it just - we have this plan, you may participate if you want?

It's touchy because it deals with compensation issues, which is really weird to bring up after you've been hired, but do you feel like you've been misled in any way? You may be able to bring it up in terms of total compensation.

I'd try to find out what's up with the other insurance plan, too.

(FYI ... I happen to believe that tech companies, even well-established ones, often offer pretty poor health insurance benefits if the workforce is mostly young.)
posted by stowaway at 9:27 AM on August 27, 2012 [1 favorite]

Serious question: how much is this worth to you? The first thing you should figure out before talking to HR is how much compensation you are willing to give up in exchange for a better insurance plan. It would be very odd for you to get an effective compensation increase (via better insurance) immediately after taking a job. Not saying it's impossible, just not something I'd rely upon.

Once you know that number, you can then put numbers to your request. It's one thing to go to HR and ask for better insurance, promptly receiving an answer of "no." It's another to start talking numbers and be up front with what you value. Also, if that number is too low to pay for the insurance, HR will tell you.

An aside: One thing that surprised me when working at a small company is how expensive comprehensive insurance can be when the costs are not well-distributed over a large population. In my case, a couple employees with chronic illnesses drove up the costs tremendously, making the net insurance cost exceptionally expensive. It may very well be that your company simply can't buy better insurance at any reasonable price, and takes care of that by correspondingly increasing your salary and having you handle it yourself.

To be honest, in my case, I wanted the opposite - to have a HSA and get an increase in pay. Employer asked around and decided not to do it because I would have been the only person who wanted the lower cost plan.
posted by sockmypuppet at 9:46 AM on August 27, 2012 [2 favorites]

Don't underestimate the impact. High-deductible, no RX (and not generous for dependents, I'd bet) plans can be VASTLY cheaper -- like $10k/employee/year or more when you take into accout the intrinsically lower cost plus no RX benefits selecting against sicklier employees. That difference would come straight out of salaries or profits.
posted by MattD at 9:49 AM on August 27, 2012

This seems like a really difficult thing to bring up as a new employee, unless you feel like you've been deceived. You'd effectively be asking them to give everyone at your site a raise. And they'd be committing to continuing to give you all raises for the foreseeable future, as the cost of insurance rises.

As for whether offering two different plans is legal, when I worked for an organization that had locations in two states, I'm pretty sure we had different insurance options. I had my insurance through BCBS Massachusetts, which may have been offered to my colleagues in New Hampshire but wouldn't have been practical for them. I'm not sure if the NH plan was available to me, since we opened the NH site after I started work. If, say, there's a San Francisco office with a kickass Kaiser Northern CA plan, that still might not do you much good.
posted by mskyle at 9:50 AM on August 27, 2012

like $10k/employee/year or more

My company of about 20 folks has the most kickass plan offered by BCBS. No deductible, 100% coverage in-network PPO, $15 Rx copay, $20 office visit copay, $100 ER copay. This plan costs a bit under $400/month (which my employer, who is awesome, eats the full cost of) for a single person regardless of age/sex/health. (It goes up significantly for dependents, unfortunately.)

Anyway, I'm just saying...it doesn't have to break the bank.

HSAs are specifically designed to fuck over people who actually go to the doctor.
posted by phunniemee at 10:15 AM on August 27, 2012

An HSA itself isn't problematic. Like all insurance, depending on when/if you need to use it the plan may be good or bad. Generally speaking if you are single, young or healthy an HSA or other high deductible plan can work in your favor. The problem here isn't the plan as much as it is the employer contribution.

I had an experience with an employer who didn't make contributions to the heath plan. It helped that I was part of the management team, but I explained to my colleagues and superiors that this was a matter of being competitive. We were having a little trouble attracting talent (and some concern about fleeing talent) and I made the case that we were going to have to up the ante somewhere. We could increase salaries but we could also spend pre-tax money on the health care plan for all employees present and future. It took a while for it come around, but in a couple of years we had a modest company contribution in place.

Whatever they do must be done for all employees, so don't discuss it in terms of what is fair for you. That ship sailed when you accepted the offer. Your best bet is to get a dialog going about whether the contribution rate makes the company an attractive employer.
posted by dgran at 10:59 AM on August 27, 2012

The high-deductible insurance that accompanies an HSA is often very good in terms of limits and exclusions, because it can function as insurance rather than as pre-paid care which low/no deducatible coverage functions as, and which is going to be expensive.

Phunniemee, it's not an accident that no dependent comprehensive coverage is cheap. Employers with those plans attract employees without dependents, and those employees tend to use much less healthcare themselves (because they are young, or are single -- single women who have jobs with benefits tend not to get pregnant, and single men tend not to go to the doctor at all).
posted by MattD at 1:52 PM on August 27, 2012

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