A record number of older adults are now choosing to stay in the workforce much longer than their predecessors — some of them working even into their 80s — and as the United States job market changes, business leaders are wrestling with the challenges that come with a much more age-diverse workforce.
Almost all employers are happy to hear that their older workers are interested in sticking around due to their heightened level of skills and expertise. However, according to a recent employer survey from Willis Towers Watson, half are concerned about how their annual benefits spend will increase as a result.
One major challenge involves skyrocketing health-care costs. Many employers are already passing rising expenses along to their employees. As more older workers are in the mix, human resources managers must find coverage options that accommodate both ends of the age spectrum, while understanding there’s a limit to what their employees can afford.
There is an easy solution to this issue: Transitioning more age-eligible employees to Medicare. Both workers and employers can benefit from this solution. While employers are not allowed to force people to transition, Medicare may be a better alternative, and more workers who understand the benefits are choosing to move to Medicare on their own.
Medicare has obvious benefits for employers. This is coverage that individuals have paid for throughout their working lives, it enables quality care and it eases pressure on the bottom line.
For many employees, Medicare also provides the better, more affordable option. As individuals age, their health care needs generally increase. According to data from the Kaiser Family Foundation, almost a quarter of the 65 and up survey respondents said their health was “fair” or “poor,” and poor health frequently leads to more doctor appointments and more money spent. Especially as companies shift to high-deductible plans and larger co-pays, this increased utilization of health-care services can exact a heavy toll on older workers.
But with Medicare, employees can customize their health-care coverage by picking and choosing which of its different parts makes the most sense for their unique health needs, something they can’t do with their employer’s one-size-fits-all plan. Medicare networks also tend to include more providers, with 93% of primary care physicians accepting it, and premiums are stable and can be as low as $135.50. Deductibles are often under $200, and out-of-pocket costs typically less than those from employer plans.
These data points aren’t common knowledge, and most people don’t understand Medicare’s many nuances either.
Employees need good guidance, and it truly takes an expert to understand the many ins and outs of this federal insurance program. Business leaders shouldn’t be expected to know what kinds of services are covered by Parts A, B, C and D. They don’t need to know about Medicare Advantage (Part C) and Medigap supplemental insurance plans. What is required is the knowledge that they can and should be assisting their older workers with this decision-making process. This is the easier path.
Knowing that an employee qualifies for Medicare is really the first step when considering the cost-reducing alternatives for their company and their workforce. It’s not necessary for HR professionals to become thoroughly knowledgeable about Medicare, as they already have enough on their plates. The key is realizing that Medicare expertise is available to help employers and their older workers make the most of this health-care alternative.
People are living longer and choosing to spend a few more years of their time in the workforce. Business leaders have to appropriately respond to this new normal. It can pay to enlist help from an experienced Medicare advisor with the knowledge needed to prevent potentially expensive mistakes. Fortunately, business leaders and human resources managers can help make this very necessary adjustment.
Medicare exists for a reason, and it’s time employers help their older employees utilize it.