Although most Americans have at least a lingering idea that health care is expensive, a number of studies have shown that a large percentage have a poor sense of how much a medical emergency would cost them.
Young people are the worst when it comes to understanding health care economics. Millennials, most of whom don't visit the doctor often, typically underestimate the cost of a medical service, a new study by Columbus, Georgia-based supplemental insurer Aflac shows.
In its poll of 5,000 employees, Aflac found that two-thirds of those between 18 and 36 underestimate the cost of a given medical expense, compared to 45 percent of the overall population.
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It's not like youngsters are too rich to care about an unexpected medical bill. Two-thirds say they wouldn't be able to cover a $1,000 hospital bill because of insufficient savings. They are also more likely to say that they would use unconventional means to pay off a bill, such as borrowing from friends or family or even starting an online crowdsourcing campaign.
"Millennials' resourcefulness in trying alternate means to cover health care costs illustrates their deep concern for financial safety in the event of an unexpected injury or illness," says Matthew Owenby, chief human resource officer for Aflac. "But the bottom line is that they tend to be both financially strapped and less aware of the potential costs of an accident or illness. We need to do a better job in educating them about how voluntary insurance can provide solutions for those who are looking to avoid a crippling debt."
The Aflac report also suggested that offering additional voluntary benefits, such as critical illness insurance, disability insurance, accident insurance, or hospital insurance leads to employees feeling more financially secure and more satisfied with their jobs overall.
Seventy-three percent of employees who were offered voluntary benefits at work say they were prepared to pay for major out-of-pocket expenses that aren't covered by conventional health insurance, compared to 56 percent who are not aware of such benefits. Seventy-three percent say they are satisfied with their work, compared to 57 percent of other employees.
It's impossible to attribute that heightened sense of financial security and satisfaction directly to voluntary benefits. Indeed, workers with access to voluntary benefits may very well simply be work jobs that are better-compensated overall.
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