Trying to understand health insurance can feel like trying to read a book that’s written in a different language and has half the pages missing. Deductibles, copays, provider networks… it’s enough to make anyone’s head spin. And if you’re in HR or leadership, you’re likely the go-to person when confusion strikes.
The good news? You don’t need to be fluent in insurance-speak to help your team feel confident about their coverage. With a few simple explanations, you can guide employees through the fog and help them make sense of their healthcare benefits, without breaking into a cold sweat.
Let’s unpack the questions you’re most likely to hear (and how to answer them like the calm, collected rockstar you are).
What are Deductibles, Copays, and Coinsurance?
These three terms are the usual suspects when it comes to confusion. The trick is to take off the technical hat and put on the plain-English one.
Think of a deductible like a cover charge at a concert. It’s the amount your employee has to pay out-of-pocket before their insurance kicks in. Once they’ve paid the price of admission, the insurance company starts picking up more of the tab. Until they’ve paid the deductible, insurance pays nothing for most services.
A copay is like a flat-rate cab ride. You pay $30 to see your doctor, no matter how far the trip goes. It’s predictable and not tied to the total cost of the service.
Coinsurance is a bit more like splitting a bill at dinner. Once they meet their deductible, your employee is only responsible for a portion of the bill. They might pay, say, 20%, while insurance covers the other 80%.
Use real-world examples when explaining these concepts. “Let’s say you’ve met your deductible, by paying $150 at your first appointment of the year. Then you have a $500 procedure. You owe 20% coinsurance, so you pay $100 towards the procedure. Your insurance would pay the rest. Scenarios like this one help the concepts click and feel less intimidating.
Can I Keep My Doctor?
This question comes up a lot and for good reason. People build relationships with their doctors, and switching can feel like breaking up with a partner you still love.
If a provider is in-network, it means they’ve made a handshake deal with the insurance company to keep costs lower. Using them usually saves employees money. Out-of-network? That handshake didn’t happen, and costs can skyrocket or not be covered at all, depending on the type of plan you have.
Here’s a simple way to explain it. In-network is like going to the gym you have a membership to. Everything’s included. Out-of-network is like walking into a different gym and having to pay a day-pass fee just to use the treadmill.
Encourage your team to check the provider directory before booking anything, and show them how to do it. That small effort can save them a big headache.
What’s Covered and What Isn’t?
Just because someone has insurance doesn’t mean everything is included. Some services need pre-approval, and others may be considered non-essential or elective (think nose jobs or experimental treatments) and won’t be covered at all.
Help employees get cozy with their Summary of Benefits and Coverage. Let them know they’re not expected to memorize it, but it’s worth a skim before big procedures or specialist visits.
You can think of it like this: Insurance is more like a curated menu than an all-you-can-eat buffet. If you have to pay extra for dessert, you can decide whether you still want to order the chocolate cake or you’d prefer to grab some ice cream somewhere else to get your sugar fix.
Why Was My Claim Denied?
Getting a denial letter can feel like being ghosted after a great first date. It’s confusing and kind of upsetting. But often, there’s a clear reason behind it.
Most denials happen because of missing paperwork, skipped pre-approvals, or using out-of-network providers. That’s where the Explanation of Benefits (EOB) comes in. It’s like a receipt showing what was paid, what wasn’t, and why.
When a claim gets denied, encourage employees to take a breath, read the EOB, and call their insurance provider. And if your benefits broker offers claims support? Now’s the time to loop them in for backup.
What’s the Difference Between an FSA and an HSA?
This one stumps a lot of people, but it’s not as tricky as it sounds.
An HSA (Health Savings Account) goes hand-in-hand with high-deductible plans. Employees contribute pre-tax money they can later use to pay deductibles, copays, and other qualified medical expenses. Think of it like a personal health piggy bank that your employee owns. It rolls over year to year and even follows them if they leave the company. It can even earn interest if employees invest their money.
An FSA (Flexible Spending Account) is more like a store gift card with an expiration date. It’s also pre-tax money, but it usually has a “use it or lose it” rule at the end of the year and is tied to their job.
Can I Change My Insurance Mid-Year?
Adding a baby, getting married, losing coverage through a partner—these are called qualifying life events (QLEs), and they let employees change their benefits outside of open enrollment.
If your accounts payable manager gets married and wants to add a partner to their plan, they can do that, even if they are outside of open enrollment, because marriage is a QLE.
The key is timing. Employees need to let you know soon after the event—usually within 30 days—and provide a little paperwork.
It’s like buying an ice cream cone on a hot day. You’ve got to eat it fast or it melts away.
Should I Choose an HMO or a PPO?
When choosing a plan, the HMO vs. PPO debate often comes down to priorities.
HMO (Health Maintenance Organization) plans are like riding the city bus—cheap, structured, and you’ll need a transfer (referral) to see a specialist. PPO (Preferred Provider Organization) plans are like having your own car—more freedom to choose your route, but your car payment and gas bill cost more than bus fare.
Help your team weigh what matters most: lower costs or more flexibility? There’s no wrong answer; just different roads to the same destination.
What Happens When I Change Jobs?
Of course you hope your staff never moves on. One of the reasons you provide health benefits is for employee retention. But people move, retire, or sometimes just decide to part ways with an employer.
When someone leaves the company, health insurance doesn’t go with them. At least not for free. That’s where COBRA comes in. It lets them keep their plan, but they’ll pay the full monthly cost or premium. The cost of insurance can be a shock if they’re used to the company covering a big chunk of it.
You can also let them know about options like buying through the health insurance marketplace or checking if their new job offers coverage right away.
Even a simple, “Here’s what to expect and where to look next,” can ease a lot of anxiety. Showing the employee that even on their way out, you still care about their well-being can go a long way, especially when the rest of your staff is paying attention.
Educate Early, Communicate Often
You don’t need to wait for the questions to start rolling in to start providing guidance. Hosting Q&A sessions, sharing a go-to folder with plan details and FAQs, or partnering with a benefits agency that offers benefits communications services can save you and your team a ton of confusion.
When people understand their benefits, they use them better. And when they use them better, everyone wins.
One Last Thing…
Health insurance might always have its fair share of fine print but your approach doesn’t have to add to the confusion. When you speak in plain English, offer relatable guidance, and stay calm under pressure, you become the go-to resource your team knows they can trust.
Want help making healthcare employee benefits easier to explain and easier to understand? Let’s chat. No pressure. Just practical support for you and your team. With our help, you won’t sweat the hard conversations as your people figure out how to understand and use their health insurance. When your healthcare employee benefits are done right, you’ll see huge gains in employee satisfaction and loyalty and your budget won’t have to feel the burn. Let us be your spotter as you figure out your benefits package.