- Research Ties High Health Insurance Literacy to Better Outcomes
- More Insured Individuals Driving Accelerated Health Spending
- Average Hourly Earnings for U.S. Workers Held Steady in April
- U.S. Productivity in Q1 Fell for First Time in Nearly Three Years
- Bipartisan Bill Seeks to Install Portable Retirement Accounts
- Florida Passes Employer-Friendly Bill on Noncompete Agreements
Research Ties High Health Insurance Literacy to Better Outcomes
People with higher health insurance literacy are likely to experience fewer unexpected costs and have better healthcare experiences, according to new research from Cigna Healthcare.
According to the study of more than 7,500 American healthcare consumers, nearly 1 in 3 survey respondents with low health insurance literacy said they received an unexpected bill or coverage decision, compared to only 14% of those with high health insurance literacy. These negative experiences can lead to delayed or skipped care.
The report indicated individuals with high health insurance knowledge are more likely to:
- Rate their physical and mental health positively;
- Manage chronic conditions effectively, and adhere to prescribed treatments;
- Receive preventive healthcare services, such as annual physicals, dental cleanings and cancer screenings; and,
- Research and compare health plans and participate in programs to manage their chronic conditions.
Cigna found that knowing how to evaluate and use health insurance is a strong indicator of satisfaction with employer-provided health benefits. The report stated 75% of people with high health insurance literacy are satisfied with their employer benefits, compared to 23% with low literacy. Additionally, 94% of those with high literacy are satisfied with their health insurance provider.
More Insured Individuals Driving Accelerated Health Spending
Spending for physician and clinical services saw faster growth rates, rising by 7.6% and 7%, respectively, according to a new American Medical Association Policy Research Perspective report on health spending trends, released on May 5. The report encompassed all related spending for 2023, the most recent full-scale data examination period.
“The faster growth is driven by increased utilization, as evidenced by the fact that — after adjusting for price changes — spending on hospital care, prescription drugs, and physician and clinical services all accelerated compared to the previous year,” said AMA economist and report author Allen Hardiman. Comparatively, spending on physician services and clinical services rose 4.9% and 3.8%, respectively, in 2022.
This acceleration extended to other personal healthcare spending categories such as hospital care and prescription drugs.
Faster spending increases for hospital and physician services also boosted out-of-pocket spending, which rose 7.2% in 2023. Hardiman noted high rates of health insurance coverage may be driving out-of-pocket spending.
“With more people insured, they’re able to access healthcare services, but that also means they incur additional costs like co-pays and deductibles, which contribute to the increase in out-of-pocket spending,” he said.
More out-of-pocket spending also may reflect a shift in healthcare cost distribution. Consumers are spending more out-of-pocket and using more services because they have coverage, Hardiman said.
Average Hourly Earnings for U.S. Workers Held Steady in April
Real average hourly earnings for American workers were unchanged from March to April, seasonally adjusted, according to data released Tuesday, May 13, by the U.S. Department of Labor’s Bureau of Labor Statistics (BLS). This result stemmed from a 0.2% increase in average hourly earnings combined with a 0.2% increase in the Consumer Price Index for All Urban Consumers (CPI-U). Real average weekly earnings decreased 0.1% over the month due to no change in real average hourly earnings combined with no change in the average workweek.
From April 2024 to April 2025, real average hourly earnings increased 1.4%, seasonally adjusted. The change in real average hourly earnings combined with a 0.3% increase in the average workweek resulted in a 1.7% increase in real average weekly earnings over this period.
For production and nonsupervisory employees, real average hourly earnings rose 0.1% from March to April, seasonally adjusted (a 0.3% increase in average hourly earnings minus a 0.2% increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers [CPI-W]).
Real average weekly earnings rose 0.1% over the month due to the change in real average hourly earnings combined with no change in the average workweek.
For this worker category, from April 2024 to April 2025, real average hourly earnings increased 1.9%, seasonally adjusted. The change in real average hourly earnings combined with an increase of 0.3% in the average workweek resulted in a 2.2% increase in real average weekly earnings over this period.
U.S. Productivity in Q1 Fell for First Time in Nearly Three Years
American nonfarm business sector labor productivity decreased 0.8% in the first quarter of 2025, the BLS reported on May 8, as output decreased 0.3% and hours worked increased 0.6%. This
is the first decline in nonfarm business sector labor productivity since the second quarter of 2022. From the same quarter a year ago, nonfarm business sector labor productivity increased 1.4% in the first quarter of 2025.
Unit labor costs in the nonfarm business sector increased 5.7% in Q1 2025, reflecting a 4.8% increase in hourly compensation and a 0.8% decrease in productivity. Unit labor costs increased 1.3% over the last four quarters.
The BLS calculates unit labor costs as the ratio of hourly compensation to labor productivity. Increases in hourly compensation tend to increase unit labor costs, and increases in productivity tend to reduce them. Real hourly compensation, which considers consumer prices, increased 1% in Q1, and was unchanged over the last four quarters.
Bipartisan Bill Seeks to Install Portable Retirement Accounts
Reps. Lloyd Smucker (R-Pennsylvania) and Terri Sewell (D-Alabama) and Sens. John Hickenlooper (D-Colorado) and Thom Tillis (R-North Carolina) reintroduced the “Retirement Savings for Americans Act” (RSAA), legislation that aims to help low- and middle-income Americans save money for retirement. The bill, which was first introduced in December 2022 and reintroduced in October 2023, would establish a program that gives eligible workers access to portable, tax-advantaged retirement savings accounts.
If passed, the RSAA would allow the federal government to match a 5% contribution for low- and middle-income workers (at 1% non-elective and 4% safe harbor), with the match beginning to phase out at median income.
“Over half of working employees lack access to the tax-advantaged retirement benefits that many higher-income earners take advantage of to save,” said Smucker. “Additionally, as the workforce continues to innovate and more Americans become categorized as ‘gig workers,’ the reliance on traditional employer-sponsored plans causes too many workers to slip through the cracks. [These] Americans deserve a modern pathway to find financial security in their retirement.”
A study by the National Council on Aging found 80% of aging Americans are struggling financially or are at risk of financial insecurity, and therefore, are not prepared to retire. An October 2024 Mercer report that evaluates the world’s retirement systems placed the U.S. 28th out of 48 scored countries, earning it a C+ grade, mainly because of current shortcomings for gig workers and blue-collar workers. If trends continue, studies show inadequate retirement savings will cost state and federal governments a combined $1.3 trillion in increased spending by 2040.
The legislation, though, is not without its critics. According to Morningstar research, the RSAA would likely change both investor savings behavior and retirement plan sponsor behavior, resulting in lower net savings rates.
Florida Passes Employer-Friendly Bill on Noncompetes
State legislation in Florida would make it easier for employers to impose noncompete agreements on their workers, including lower-level staffers, and make it more difficult for employees to challenge these agreements in court.
The “Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act” passed the state’s House of Representatives by a 91-21 vote and the Senate by a 28-9 vote. If Gov. Ron DeSantis signs the bill, which he is expected to do, the law would take effect at the start of July.
Under previous Florida law, noncompete agreements were enforceable if the organization asking workers to sign them could provide legitimate business reasons why they were necessary. If such agreements were challenged in court, a judge would typically rule on the merits of those reasons.
Under the new law, though, any employer with employees who are “reasonably expected” to earn more than twice the annual mean wage of the county where the business is located can subject workers to noncompete agreements. The law also would apply to independent contractors and out-of-state employees. If a worker wants to challenge a restrictive covenant, they would need to prove in court that:
- They are not in a competitive role; or,
- The agreement violates the CHOICE Act in some way.
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