Wells Fargo has decided to make some big changes to the health insurance plans that it offers it’s employees. The overall purpose is so bank will save money by spending less on health care. This leaves the people who work for Wells Fargo with some difficult choices.
Starting next year, Wells Fargo is going to roll out a new employer sponsored health insurance plan. The new plan will require employees to do one of two things. They can put their own (pretax) dollars into a savings account. Or, the worker can pay a higher health insurance premium (and let Wells Fargo fund the employee’s account).
There are advantages and disadvantages to each of these choices. If the employee decides to put more of their own money into a “health savings account”, the advantage is that their insurance premium will be lower. The problem, though, is that it leaves the potential that the worker will not have enough money saved up to cover big medical bills.
That problem can be avoided if the employee chooses to let Wells Fargo put it’s money into the worker’s “health reimbursement account”. However, this means that the employee will be paying a higher insurance premium than he or she might have had to pay before these changes were made.
One of the reasons why Wells Fargo is going to use a system that includes a health savings account is because it will help the bank save money on the cost of the health insurance. These types of savings accounts tend to make people think more about what they are spending on health care. This awareness tends to make people use less insurance.
A report that was done by the Iowa Policy Project shows that it is becoming more difficult for people to find employer sponsored health insurance. Employers have been reducing the amount they spend on health insurance by reducing the number, and type, of workers that they will offer it to. They are also cutting their costs, with initiatives like what Wells Fargo is doing.
Often, when one big company makes takes a cost-cutting measure, it influences other large corporations to do the same thing. This means that what Wells Fargo is doing could result in a wave of companies reducing their health insurance costs in the same way very soon.
What if your employer decided to do this? Would you choose to let your company pay a slightly larger portion of your health insurance (and pay a higher premium yourself)? Or, would you rather pay a lower health insurance premium, (and be expected to fund your health savings account by yourself)? This is not an easy financial decision to make.
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