Employees consider health insurance more important than any other workplace benefit, making it a powerful tool for recruiting and retention. 1 Yet, after you research and select a plan, only a handful of your employees actually enroll. Let’s look at three common causes for why this happens, and what you can do about it.

Issue 1: Employee preferences.

Employees’ preferences for catastrophic coverage versus regular doctor visits with low copays can be influenced by their age, family size and financial situation.

Suggestion: Gauge your employees’ health needs with a company-wide survey or questionnaire, ideally making it anonymous to help ensure a higher response rate. This will give you an idea of what factors influence their enrollment decision.


Issue 2: Your network.

If your plan’s in-network provider list doesn’t include the doctors or facilities your employees prefer, they may forego enrolling.

Suggestion: This is another area where a survey can help. Include questions to determine what kinds of doctors, facilities, or hospitals your employees want in network, and what prescription drugs they’d like covered.

Issue 3: The costs.  

Even when employers and employees share the premium cost, health coverage can take a substantial chunk out workers’ paychecks. Beyond the monthly premium, 83 percent of covered workers have an annual deductible that must be met before their plan kicks in and pays for services.2   And that deductible can be steep: The average deductive for covered workers in small firms is $2,295.3

Suggestion: Consider putting money into a tax-advantaged savings account, such as a flexible spending account (FSA). Both employees and employers can make pretax contributions via payroll deductions to FSAs that can be used during the year to pay for medical expenses. An FSA is compatible with any type of health plan, but the contributions are “use it or lose it” meaning money in an FSA expires at the end of the year and reverts to the employer.



  1. “Company Benefits and Perks: Are You Keeping Up?” Monster, last accessed January 20, 2021, https://hiring.monster.com/employer-resources/workforce-management/employee-benefits-management/competitive-benefits-and-perks/, opens new window.
  2. “2020 Employer Health Benefits Survey,” Kaiser Family Foundation, last accessed January 20, 2021, https://www.kff.org/report-section/ehbs-2020-summary-of-findings/, opens new window.
  3. “2020 Employer Health Benefits Survey,” Kaiser Family Foundation.

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