The Advisor's Edge - April 2026
The $47 Billion Problem: Why Your Employees Keep Making Expensive Healthcare Decisions
It’s 11:15 PM on a Tuesday. Your employee’s six-year-old daughter has a 101-degree fever, a sore throat, and has been sobbing uncontrollably for the last two hours after originally going to bed at 7:30 PM. At the moment, the parent doesn’t remember the 24/7 virtual care benefit included in your plan. They don’t think about telemedicine. They just know their pediatrician’s office is closed, the urgent care is closed, and their child is in pain. So, they do what feels safest: drive to the emergency room.
Four hours and $3,800 later, the diagnosis is strep throat. A virtual visit with a physician would have cost the employee $0 and taken 15 minutes, and it would have cost the plan $49.
Multiply that scenario across your workforce. That’s the healthcare illiteracy tax you’re paying every single day.
Unnecessary ER visits cost the healthcare industry $47 billion annually, according to Accenture. The primary driver? Patients with low health system literacy who don’t understand where to go for care.
But here’s what makes this particularly frustrating: you’re already paying for the alternatives. Telemedicine. Virtual primary care. Decision support tools. Navigation services. Your employees just don’t know they exist, don’t understand how to use them, or don’t trust them enough to try.
Healthcare illiteracy isn’t just costing you money. It’s costing your employees health outcomes, time, and financial stress. And it’s completely preventable.
What Healthcare Illiteracy Actually Costs
Not limited to unnecessary ER usage alone, low health literacy is estimated to cost the U.S. economy up to $236 billion annually through medical errors, increased illness and disability, lost wages, and compromised public health.
But those are macro numbers. What does it look like at your organization?
Research shows that employees with limited health literacy report fewer doctor office visits, greater ER use, more hospitalizations, and higher rates of potentially preventable hospital admissions. They’re making decisions that cost more and deliver worse outcomes.
The most common manifestations of healthcare illiteracy:
Wrong site of care. Employees go to the ER for conditions that could be handled through telemedicine ($49), virtual primary care ($75), urgent care ($150), or a primary care visit ($125). Every avoided ER visit saves between $309 and $1,500.
Brand medications when generics are equivalent. Employees don’t understand that generic and brand-name drugs contain the same active ingredients. When generic fill rates increase from 70% to 85%, the savings are immediate and calculable.
Out-of-network usage. Employees don’t check whether their provider is in-network, then face surprise bills that strain their finances and drive up plan costs. This is especially true when a narrow network strategy is being used.
Delayed or avoided preventive care. Employees skip annual physicals, cancer screenings, and chronic disease management because they don’t understand that preventive services are covered at 100%. Later, you pay for emergency interventions that could have been prevented.
lack access to prior. Without guidance, employees agree to expensive MRIs when X-rays would be clinically appropriate, or undergo duplicate testing because providers don’t have access to previous results.
Between 13% and 37% of ER visits could be safely referred to primary care, urgent care, or retail clinic settings, according to the Agency for Healthcare Research and Quality. For a 500-employee company with average healthcare utilization, that translates to hundreds of thousands of dollars in avoidable costs every year.
Why Traditional Education Fails
Most employers assume they’re already doing benefits education. After all, you send out open enrollment packets, hold benefits fairs, and post information on your intranet.
The problem isn’t that you’re not communicating. The problem is that your education strategy is fundamentally broken.
The timing is wrong. You dump information on employees in October for a January effective date. Then, when they need care in March, they have no memory of what you told them four months ago and no idea where to find the information.
The channel is wrong. You’re sending PDFs and emails to a workforce that consumes information through video, text messages, and mobile apps. You’re using the tools you prefer, not the ones your employees actually use.
The content is wrong. You explain deductibles, coinsurance, and out-of-pocket maximums using insurance industry language. Your employees nod along, then make decisions that prove they didn’t understand a word.
The approach is wrong. You treat benefits education as an annual event instead of an ongoing support system. Healthcare decisions don’t happen once a year. They happen at 11 PM on a Tuesday when a child spikes a fever.
The result? Employees who are confused, overwhelmed, and defaulting to the most familiar option: the emergency room.
What Good Education Actually Looks Like
Effective healthcare education isn’t about better brochures. It’s about meeting employees where they are, when they need help, with information they can actually use.
Year-round, not just open enrollment. The best programs provide ongoing touchpoints: monthly emails on specific topics, quarterly webinars, text message reminders, and always-available resources. Education becomes a relationship, not an event.
Just-in-time, not six months early. Employees need information when they’re making decisions, not months before. When someone’s navigating a new diagnosis, that’s when they need guidance on finding specialists, understanding treatment options, and comparing costs.
Multi-channel, not just email. Video tutorials for visual learners. Text-based support for mobile users. Phone-based concierge or navigational services for those who prefer human interaction. Decision support tools for price-conscious shoppers. The medium matters as much as the message.
Actionable, not informational. Instead of explaining how your plan works, show employees exactly what to do: “If you need care tonight, here’s the number to call.” “Before you schedule that MRI, here’s how to check if your provider is in-network.” “Here’s how to confirm your generic prescription costs $10 instead of $75.”
Personalized, not generic. Not everyone needs the same information. New parents need guidance on pediatric care access. Employees with chronic conditions need help managing specialty medications. Your education should match their actual needs, not just broadcast generic content.
Fortunately for HUB clients, we have an internal Communications & Design team to develop year-round communication strategies that actually work. These aren’t traditional benefits materials. They’re designed using consumer marketing principles: clear messaging, compelling visuals, and calls to action that drive behavior change. If you’re a HUB client reading this and you feel like you’re not getting these resources, please let me know.
How to Measure What’s Working
If you can’t measure it, you can’t manage it. The good news is that healthcare education generates measurable outcomes.
Utilization pattern shifts. Track ER visits per 1,000 employees over time. Monitor telemedicine adoption rates. Watch urgent care utilization. If your education is working, you’ll see employees shifting toward lower-cost, appropriate sites of care.
Generic fill rates. Calculate the percentage of prescriptions filled with generic medications. A well-educated workforce should have generic fill rates above 85%. Every percentage point percentage-point increase translates directly into.
Preventive care completion. Measure annual physical completion rates, cancer screening compliance, and chronic disease management engagement. These are leading indicators that predict future cost avoidance.
Engagement metrics. Track who’s attending webinars, watching videos, calling concierge services, and using decision support tools. High engagement predicts lower total cost of care.
Cost per engaged vs. non-engaged member. Segment your population by education engagement. Members who actively participate in benefits education consistently show 8-12% lower total healthcare costs than those who don’t.
Here’s a simple calculation to understand your potential savings:
Calculate your current inappropriate ER usage. If you have 500 employees and 10% made at least one non-emergent ER visit last year, that’s 50 inappropriate ER visits.
Estimate the cost difference. Average non-emergent ER visit costs $1,200. Telemedicine or virtual care costs $49-$75. The difference is roughly $1,100 per visit.
Calculate potential savings. 50 visits x $1,100 = $55,000 in avoidable costs from ER diversion alone.
Factor in other cost categories. Generic fill rate improvements, preventive care increases, and in-network utilization add another 5-8% in total cost savings.
Compare to education program cost. A comprehensive year-round education program might cost $5,000-$15,000 annually for a 500-employee group. Your ROI is 3:1 to 6:1, and that’s before accounting for improved employee satisfaction and reduced financial stress.
As you think about your benefits communication strategy, three questions should guide your approach:
When your employees need healthcare at 10 PM, do they know what to do?
Can you identify which employees are making expensive decisions due to lack of information?
Are you measuring whether your education efforts are changing behavior?
Healthcare illiteracy isn’t an employee problem. It’s a strategy problem.
You’ve invested in comprehensive benefits. You’ve negotiated strong provider networks. You’ve added telemedicine, decision support tools, and cost transparency resources.
But if your employees don’t know those benefits exist, don’t understand how to use them, or don’t trust them enough to try, you’re paying for solutions that never get used.
The most effective cost containment strategy isn’t negotiating harder with carriers. It’s helping your employees make better decisions with the benefits they already have.
That starts with education. Real education. Not annual packets and generic emails, but year-round support that meets employees where they are, when they need help, with information they can use.
The question is whether you’re ready to make the effort, and whether you have the right partner to help.
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Sources:
Accenture, “Unnecessary ER Visits Cost Healthcare Industry” (2021)
AHRQ, “Agency for Healthcare Research and Quality: Health Literacy Impact”
Journal of Medical Internet Research, “Health Literacy and Healthcare Costs”
National Institutes of Health, “Health Literacy Impact on National Healthcare Utilization”
HealthLeaders Media, “Cost Savings for Telemedicine Estimated at $19-$121 per Visit”
News You Can Use
Will You Be Attending SHRM26 in Orlando from June 16-19th? If so, please consider attending HUB’s hospitality event. It will be held on Wednesday, June 17th, from 6:00-9:00 PM at Kavas Tacos + Tequilla. Send me a quick note so I can ensure you are personally greeted by an associate, and click here to RSVP.
April is Financial Literacy Month. To help promote literacy, we’re offering clients a free opportunity to experience FinPath, HUB’s proprietary financial coaching and education platform. You and your employees can benefit from a free, interactive education course through Choosewell, plus a chance to win $50. Visit FinPath Wellness to register and take the course.
Navigating Medicare can be hard. In the “worth sharing” segment below, I share a few details on helping my parents navigate senior living. Whether for your parents, yourself, your employees, or your own education, it’s important to understand how Medicare decisions carry more financial weight than most retirees realize. I encourage you to review a recent presentation hosted by HUB’s Private Wealth Management team. Check it out here.
Worth Sharing
I mentioned in the March Issue of The Advisor’s Edge that my dad had taken a fall. Having had a stroke that caused partial paralysis, paramedics were called as he was unable to get up. They determined he needed to go to the Emergency Room.
I was literally on-stage at a DisruptHR NOCO event on March 4th when I received the call. I had to reach down into my pants pocket to silence the phone notification.
From the ER, he was admitted. After about five days in the hospital, he was transferred to a rehab hospital in Fort Collins. Fortunately, he has now returned home, but he was hospitalized for an entire month.
There were some days of uncertainty when we did not know whether returning would be an option. For a while, it looked like we might have to admit him to assisted living.
Fortunately, our family had already started some very necessary conversations. About a year ago, my parents provided access to their financial position - for the very first time. We also began the conversations about possibly moving them out of their home and into an independent living facility.
Since then, we have toured multiple locations, made a decision, enrolled in the waitlist, and made the necessary deposit to hold their spot. We’re hoping that in the next 6-8 months, they will be able to transition into a new beginning, surrounded by community, connection, and care.
Those plans, however, never anticipated a fall. They never anticipated a month-long hospitalization, and they never anticipated a possible escalated need for assisted living.
I thought we were ready, until we were not.
If you’re reading this, and your parents are still alive, begin these conversations now.
It’s uncomfortable. It may be unwelcome. You may meet some resistance. Stand strong in your insistence and use our situation as an example.
You never know when an untimely call may come. Don’t wait for that phone to ring to begin planning.
As a HUB employee, we have access to a program called Homethrive. It may be something for your company to consider offering to your employees.
If I can be of assistance, please let me know.