Unhappy With Your Health Insurance? Your Employer May Not Care
Unhappy With Your Health Insurance? Your Employer May Not Care
Although 58% of Americans rely on employer-sponsored health insurance, U.S. corporations are doing surprisingly little to improve health-care options for their employees, according to research by Graduate School of Business Professors Jeffrey Pfeffer and Sara Singer.
Stanford Health Policy’s Sara Singer and Jeffrey Pfeffer—both professors of organizational behavior at Stanford Graduate School of Business—study health-care policy and human resources. They also serve on Stanford’s Committee for Faculty and Staff Human Resources, which has given them a firsthand view of how large organizations make decisions about employee health plans.
A few years ago, after much discussion, the university changed health insurance providers. Afterwards, Pfeffer recalls, “I said, ‘You know, these people made promises. Is there going to be any follow-up?’ And people looked at me like I was nuts—like, why would you ever do that?”
In a series of new papers, Singer and Pfeffer take a closer look at how employers pick health-care benefits and whether they follow-up they to see if these often enormous expenditures meet their employees’ needs. Based on their previous research and their own experiences, Singer, PhD, MBA, and Pfeffer, PhD, expected that their findings would be discouraging.
“But we didn’t realize it would be this bad,” says Singer, who is also a professor of health policy at Stanford School of Medicine. “The absence of agency was striking,” Pfeffer agrees.
Their findings are based on a survey sent to a representative sample of U.S. organizations with more than 50 employees. It asked the companies how they chose health insurance plans, assessed the value and performance of those plans, tried to reduce costs and improve value for employees, and whether they ever asked employees for feedback. Around 225 companies responded.
Since then, Pfeffer and Singer have been sifting through the data and parsing it in a series of papers. The first two, published earlier this year, examine how much employers emphasize financial considerations versus member experiences when making these decisions and how much measurement and management oversight accountability they provide. A forthcoming article, co-authored with law professors Barak Richman of George Washington Law and Amy Monahan of the University of Minnesota Law School, analyzes how well companies meet their fiduciary obligations under the Employee Retirement Income Security Act (ERISA) when managing employee benefits.
The answer: for the most part, not very well.
