“As health care costs rise, there is more overlap between health decisions and financial decisions,” said Stan Dorsey, director of health solutions thought leadership at Fidelity Investments, during a session presented by Fidelity at the 2021 virtual PLANSPONSOR National Conference (PSNC).
Tamara Sims, director of behavioral science health solutions thought leadership at Fidelity, said that when looking at a person’s total well-being, one can’t just look at the person’s financial situation to know how to help them maintain stability over their lifetime. There are other factors to consider, such as health care.
“There are lots of good rules of thumb when making financial decisions, but when it comes to health care, it’s personal and becomes more complicated,” Sims said. “We’ve seen a rise in health care consumerism as individuals are not just letting health treatment decisions rest in the hands of physicians.”
She added that Fidelity research shows most individuals score low on health care literacy, so there’s an opportunity for employers to provide employees with decision support tools and to educate them about how to plan for health care and choose high-quality care.
“Knowledge helps people make the right choices, and confidence motivates them to make any choice at all,” Dorsey said.
Fidelity research also looked at preferences in health care and financial decisionmaking. Dorsey said the most engaged decisionmakers like to have control of the situation (i.e., take charge of decisions), prefer high-quality versus low cost, and trust employer financial and health information. They are also willing to take financial risks and take and adhere to high-quality advice.
“Trust in information sources, willingness to adhere to advice and [high] risk tolerance all lead to more confidence and better decisionmaking,” Dorsey said. “If employers know this, they can use it to help employees.”
He suggested that education and communication about benefits should promote increased knowledge, be consistent and encourage the use of benefits provided. In addition, employers should share representative employee experiences of challenges and successes when making health care and financial decisions and enlist managers to promote benefits. “Management is the most effective tool when it comes to affecting employee behavior,” Dorsey said.
“Employees who are savvy with both health and savings behaviors have better HSA [health savings account] behaviors—they contribute more and invest their HSA dollars,” Sims said.