Many U.S. employees are experiencing “financial fragility,” according to the “2023-2024 Aflac WorkForces Report,” which examines employer and employee benefits trends and attitudes.
The survey of 1,200 employers and 2,000 employees revealed that a full 50% of workers say they would not be able to afford more than $1,000 in out-of-pocket expenses for an unexpected medical event. What’s more, 27% would be unable to afford a $500 expense. No wonder, the report notes, that “Americans are increasingly turning to crowdfunding sites like GoFundMe to support not just their medical bills, but also the secondary day-to-day costs related to being sick and needing to take time off work. In fact, GoFundMe hosts more than 250,000 medical fundraisers each year, with health care-related fundraising as one of its largest categories.”
While eye-opening, the survey data also serves as a wake-up call for employers, according to Jeri Hawthorne, Aflac’s chief human resources officer.
“These findings … offer insight into what employers can do to help their employees navigate this instability,” she says. “Employees should think about planning for their health care both from a physical wellness perspective as well as through a financial planning lens. In many ways, health care expenses are one of the biggest ‘known unknowns,’ which makes financial planning for them even more of a challenge. Forward-thinking employers take an always-on approach to benefits communication and employee education. This helps foster financial wellbeing among their workforces.”
Hawthorne notes that Aflac educates its workforce on ways to stay healthy and take advantage of cost-effective benefits such as preventive health screenings, filing wellness claims and using tax-efficient planning vehicles like flexible spending accounts.
Other key findings of the “2023-2024 Aflac WorkForces Report” include:
- More than a quarter of employees are burdened with high health care costs. While two-thirds of employees claim that inflation negatively impacted their finances over the past 12 months, 28% cite high health care costs, and 21% blame medical costs not covered by major medical insurance.
- Nearly a third of all American workers faced difficult medical-related decisions in the past year. Almost 20% had to choose between health care or paying a bill, while 14% had difficulty affording a prescription, and another 14% had difficulty affording health care recommended to them by a doctor or a specialist.
- Employees do not understand their policies or health care costs as well as employers think. This, according to Aflac, leads to challenges in preparing for an unexpected medical event. Nearly 4 out of 5 (79%) employers think their employees understand the total annual costs of their health care “well.” When asked the same question, only 48% of employees agree.