Why the Affordable Care Act Matters to Recruiting and HR
April 21, 2015
When do employees start thinking about healthcare? Think about your own experience. When did you start thinking about it the last time you were looking for a job? Before or after you nailed the first interview? Before or after the offer was extended? Maybe you researched the company health benefits before you even applied. Glassdoor reviews, LinkedIn, social media — the answers are there.
So, how does the US Affordable Care Act (ACA) effect all of this? For recruiters and HR professionals to do our jobs right, we have to meet the needs of our clients—the candidates and employees. When we excel at explaining healthcare and the ACA, and how it impacts our people, a huge need is met. Removing the concerns around healthcare increases fill rates, our employee satisfaction level, and more.
The role of healthcare in hiring and employee satisfaction
Recent data (including BambooHR's Healthcare study) shows the significant function healthcare plays in recruiting. 83 percent of employees say health benefits influence their decision to accept a job. And once they’re in the door, 66 percent of employees say healthcare affects their job satisfaction.
As healthcare matters more and more to candidates and employees, it should matter more and more to us and be a core piece of any recruiting and retention plan.
Failing to communicate health benefits
We hear every day from recruiters and HR alike that it's overwhelming and almost impossible to keep up with it all. How can we clearly state to employees—in a way that’s simple to understand—what our healthcare plans provide when it’s difficult to understand it ourselves?
As evidence of where we are failing, employees say they are uncomfortable with the following aspects of their healthcare plans:
- 55 percent don’t know how the out-of-pocket maximum works.
- 54 percent don’t understand how to submit claims.
- 49 percent don’t know what their premium covers.
- 44 percent don’t know how their deductible works.
- 39 percent don’t understand who in-network and out-of-network providers are.
- 33 percent don’t understand why their monthly premium is what it is.
Your employees hear the term "open enrollment" from you once or twice a year, but that doesn’t mean they understand how it works or when they can switch healthcare coverage. 63 percent don’t know the only times they can switch coverage is during open enrollment or when a life-changing event occurs.
Imagine the drag that would be removed if we could get the above numbers to all drop below 10 percent.
How the Affordable Care Act has added to the confusion
Healthcare understanding certainly wasn't perfect before the ACA came along. However, the ACA has made things even more confusing and thus more difficult for HR.
Recruiters need a thorough understanding as well. Dealing with legal, compliance and plan issues alone suck up a ton of time. Pile on the challenge of explaining everything we barely understand (it's true) to employees and it gets even worse.
Most of your employees (63 percent) say they don’t understand ACA very well (or at all) and another 27 percent don’t know if their current plan is even ACA compliant.
Three out of four employees don’t understand how ACA will affect their taxes. Half of them don’t know what the penalty is for not meeting requirements. They should know they’ll be paying a fee if they’re not meeting those requirements - just imagine how unhappy they'll be when they get nailed with a fee that they feel is partly your fault for not explaining it.
The result of all this confusion
The confusion inherent in healthcare and ACA today is impacting everyone. One in three employees have felt stress either at home or work since ACA went into effect. Part of this is likely due to the increased costs and an uncertain future. 58 percent report their healthcare out-of-pocket costs have increased because of ACA. However, the quality of the coverage has not increased, even though the costs have. 24 percent claim their healthcare coverage has actually worsened!
Most of your employees know it’s not your company's fault that their coverage has changed since ACA went into effect. But still, 70 percent of people view increased healthcare costs as a pay cut, even though most of them do not blame you. Almost half blame the government. But it's important to know that some will blame your company, as 16 percent of employees hold their company responsible.
How you can lessen the healthcare conundrum
Most of your employees (58 percent) think HR does a great job explaining healthcare to them, which means 42 percent of us are failing. So, here are some suggestions that can help:
1. Get recruiting and HR on the same page.
Healthcare is a huge selling point for both candidates and employees, and it should be leveraged whenever possible. Candidates need to understand—thus, recruiters need to understand—exactly how healthcare works, what the company philosophy is around it and what the tangible and intangible benefits are to the employee. Managing expectations and building trust starts with the recruiter and continues with HR reinforcing the message. The message has to be the same.
2. Communicate clearly.
Healthcare and the ACA will change; plans will change; laws, technology and options will all change. Continue building trust with clear and early communication with employees around what your company is doing and why. Yes, we need to hold the employees’ hand. Just look at the above statistics! Also, understand that 55 percent of employees expect HR or their companies to help them understand any changes. This pain isn't going to go away, but we tend to not give it the time and diligence it requires.
The good news is that if you take the time to accomplish the right alignment around healthcare, it will give you a massive recruiting advantage, retention advantage and the right numbers will move in the right direction. It's amazing what great people do for great companies that deserve it.
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*Image by Pete