Boost employee health benefits utilization

Employee health benefits matter, with more than two-thirds of workers saying that healthcare benefits are second only to salary when considering a job offer.

But while employees seem to value benefits, they often fail to use them. Many employers see low utilization of employee health benefits, with 68% of employers saying workers underutilize the services, benefits, and programs available to them. Unfortunately, this can lead to bigger issues like poor health outcomes and higher costs.

When you put so much time and effort into choosing high-quality employee health benefits programs, you understandably want them to be put to good use.

We’re going to take a look at how you can educate your employees about their benefits and encourage them to take full advantage of what you offer. But first, let’s explore some of the reasons they might not be utilizing them…

Why aren’t people using their employee health benefits?

If workers place so much importance on health benefits, you’d think it wouldn’t be challenging to get them to use them. However, several factors lead to low employee health benefits utilization, including:

• Lack of knowledge: Benefits information is often lengthy, complex, and full of jargon that makes it tough for employees to make sense of what’s available to them. Alarmingly, only 12% of U.S. adults have high health literacy (meaning they’re able to effectively understand and apply information related to their health). Put simply, employees can’t use their health benefits if they don’t know what they are, how they work, and how they’re relevant.
• Infrequent education and promotion: Benefits tend to be a “set it and forget it” type of thing. New employees are bombarded with paperwork and resources during onboarding and then once a year during open enrollment. They don’t hear anything else about them unless the company needs to make a change. This means workers are often unaware of the details of their benefits—or they quickly forget them once they’re up to speed within the company.
• Complex processes: From copays and coinsurance to preauthorizations and provider networks, health insurance comes with layers of confusion and complexity. 36% of insured adults admit that it’s somewhat or very difficult for them to understand what their insurance will or will not cover.
• Doubt and mistrust: It’s nerve-racking for employees to hand over their health information to their employer or a third-party vendor, particularly if they have conditions they’d like to keep confidential. This lack of trust can discourage them from making full use of their benefits. And, it turns out many employers share this concern. Only 22% of employers fully trust that their digital health tool vendors are acting in the employer’s best interests.

7 tips for getting employees to use their health benefits

Some significant barriers stand in the way of high employee benefits utilization, but you aren’t powerless here. There are several steps you can take to educate and empower your employees to confidently navigate and take full advantage of their health benefits.

1. Make information easy to find and access

If employees need to wade through a 100-page PDF or endless email chains to figure out how to use their employee health benefits, they’re probably not going to bother. That’s why your first step is to make benefits information easy to find and even easier to access.

Consider a one-stop-shop benefits portal that organizes resources by care need (such as mental health, dental, etc.) and clearly outlines what’s covered and how to get started. Also, make sure your employees know who to contact with questions and the best way to get in touch with them.

2. Ensure information is easy to understand

Rather than overwhelming employees with acronyms and complex terms, focus on using plain language that’s easy to understand at a broad range of literacy levels.

Honestly, the simpler the better. The Agency for Healthcare Research and Quality (AHRQ) recommends aiming for a fifth- to sixth-grade reading level for health-related materials. Hemingway Editor’s free readability checker is an example of an easy tool you can use to get a grade level for your text.

Call attention to key details (like coverage amounts, copays, and how to access care) using bold text or bulleted lists, and use infographics and simple calls to action (e.g., “Call this number to schedule a screening”) to ensure the main takeaways are unmissable.

These seemingly small changes can go a long way. Research shows that employees are significantly more likely to participate in their health benefits when they feel adequately informed.

3. Leverage employee testimonials

Sharing real stories from employees who have successfully used a particular health benefit can make it feel more approachable and real. Whether it’s a quick video clip or a written quote, these testimonials show how the benefit worked, how easy it was to access, and the positive impact it had on the person’s health and life.

As with any other type of testimonial, authenticity matters. When you can, try to collect testimonials from your employees, as it may be more meaningful for your employees to see and hear their co-workers’ experiences. But, any testimonial is great, so if you only have the examples provided from your health benefits vendor, that works, too!

It’s also helpful to highlight a diverse range of employee health benefits—like mental health resources, fertility support, or chronic condition management—so employees can see the broad spectrum of offerings. When colleagues share real stories, it demystifies the process and encourages others to explore the same benefits.
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4. Include incentives

Offering incentives—like gift cards, extra time off, or contributions to an employee’s health savings account (HSA)—can encourage participation in wellness programs, preventive screenings, and other employee health benefits.

These incentives don’t just boost engagement. They also send a message that your company cares about employees’ health and well-being. According to a Kaiser Family Foundation survey, many employers offer some type of wellness or health promotion incentive.

This doesn’t need to be overly complex. Plenty of companies have had success with simple incentive structures—like offering $50 for completing a biometric screening or entering employees who attend a health fair into a raffle. The key is to align your incentives with desired behaviors while making them rewarding enough to motivate employees.

5. Frequently promote benefits

Open enrollment and onboarding aren’t enough. If you want employees to use their benefits, you need to communicate regularly.

Appoint benefits ambassadors—volunteers or HR reps who can champion specific employee health benefits—and encourage them to share updates in team meetings, post in Slack channels, or even host lunch-and-learns. It’s also worth organizing benefits fairs or on-demand webinars where employees can get their questions answered.

Repetition builds awareness. When employees hear about benefits multiple times throughout the year in different ways, they’re more likely to retain the information and take action. Plus, involving managers in the conversation reinforces the message that benefits aren’t just HR’s responsibility—they’re a core part of the company’s commitment to employee well-being.

6. Get regular feedback from employees

Regularly gathering feedback from employees helps you understand why certain employee health benefits are underutilized or overlooked.

Quick pulse surveys, suggestion boxes, or focus groups can reveal if employees are confused about eligibility, find a process too complicated, or simply don’t see the relevance of certain benefits.

Acting on that feedback is the most important part. If employees highlight pain points, take steps to address them—whether it’s simplifying the process, offering additional education, or working with vendors to improve communication and member experience. When employees see that their input leads to real changes, they’ll feel more empowered to engage with their benefits and more likely to provide feedback in the future.

7. Partner with your benefits vendors

You don’t have to do all of this alone. Your employee health benefits vendors likely have a lot of resources—like tailored marketing campaigns, personalized outreach based on claims data, and communication templates—to help you drive engagement.

Lean on these partnerships to lighten the load. Instead of sending the same benefits newsletter to everyone, work with your vendors to deliver the right message to the right people at the right time.

This personalized approach not only increases engagement but also helps employees feel that their benefits are relevant to their needs.

Boosting employee health benefits utilization is about making information readily available—but it’s also about making that information clear, engaging, and relevant. When you get that right, your health benefits can deliver what matters most: a healthier, happier, and more resilient workforce.

The information contained on this page is for informational purposes only. No material is intended to be a substitute for professional medical advice, diagnosis, or treatment.