Participants Do Not Understand Intricacies of Healthcare System
A study by Accenture confirms that 52% of healthcare consumers have a low “healthcare system literacy,” meaning they do not understand the complexities of the healthcare system. For example, they do not understand terms and concepts like “premium,” “deductible,” “copayment,” “in-network,” “out-of-network,” or “prior authorization.” Consumers considered “healthcare system illiterate” are not uneducated—nearly all have a high school diploma and nearly half have a college degree or higher.
These participants are much more likely to use their health plan’s customer service phone service. This means plans and insurers spend, on average, $26 more per healthcare illiterate consumer, which translates to an extra $3.4 billion annually in administrative costs nationwide. This figure includes only administrative costs, leaving out the likely higher medical costs resulting from poor decisions made by these consumers.
While streamlining the entire structure of the healthcare system may not be attainable, plans can take a few simple steps toward healthcare literacy: provide clear plan information hosted on platforms that are easily accessible to consumers; incentivize healthcare providers to help consumers navigate their coverage questions; and provide certain plan information targeted to specific individuals who need that information.