On wellness, there is a lot we speak about at work mental health days, fitness stipends, mindfulness apps, but there is another kind of wellness that is fast becoming a business priority, the financial wellness. And nowadays, in the case of so many employees, wellness begins with one challenge: the increasing cost of medical treatment.
Even with insurance, out-of-pocket medical costs can feel overwhelming. Co-pays, deductibles, prescriptions, and surprise bills pile up fast, leaving workers stressed and distracted. It’s not just about affording a visit to the doctor—it’s about trying to plan for the unpredictable without draining your savings.
So what are employers doing to help?
Forward-thinking companies are starting to tackle this issue head-on. They’re realizing that helping employees with healthcare expenses isn’t just compassionate—it’s also smart. Health-related financial stress leads to decreased productivity, absenteeism, and burnout. Supporting your team in this area can boost morale, retention, and overall job satisfaction.
Here’s how companies are stepping up to support financial wellness—and how you can, too.
Why Out-of-Pocket Costs Are a Big Deal
Let’s be real: insurance is confusing. Even when employees have coverage, navigating what’s covered, what’s not, and how much they’ll actually pay out-of-pocket is complicated.
And unfortunately, premiums are only part of the story. According to recent surveys, the average American employee spends over $1,500 out-of-pocket on healthcare annually, even with employer-sponsored insurance. For families, that number skyrockets.
These expenses catch people off guard. A surprise lab bill or out-of-network specialist can throw off a household budget for months. The result? Financial stress that bleeds into the workplace. Employees are distracted, anxious, and sometimes avoid necessary care altogether, which leads to bigger health (and financial) issues down the line.
How Employers Are Helping
Thankfully, more employers are starting to treat this issue with the urgency it deserves. It’s not just about offering health insurance anymore—it’s about helping people use it without going broke.
Let’s look at the tools companies are using to reduce employees’ financial burden:
1. Health Savings Accounts (HSAs)
HSAs are available to employees enrolled in high-deductible health plans (HDHPs), and they’re one of the most powerful savings tools around. Contributions are tax-free, funds grow tax-free, and withdrawals for medical expenses are tax-free. Plus, the money rolls over year to year and stays with the employee, even if they leave the company.
Employers can contribute to HSAs, giving employees a head start on building a cushion for both expected and unexpected health expenses. Think of it as a 401(k) for healthcare, but even more tax-efficient.
2. Flexible Spending Accounts (FSAs)
FSAs let employees set aside pre-tax dollars to pay for qualified medical expenses like copays, prescriptions, dental visits, and even contact lenses. By reducing taxable income, FSAs make healthcare spending more affordable, essentially giving employees a discount on medical costs they were going to pay anyway.
Employers can choose to contribute to these accounts or simply offer the option for employee contributions. Either way, it’s a low-cost, high-impact way to ease financial stress around healthcare.
3. Lifestyle Spending Accounts (LSAs)
While LSAs aren’t tax-advantaged like FSAs or HSAs, they offer unmatched flexibility. These after-tax accounts can be used to reimburse employees for things like gym memberships, mental health services, wellness apps, or even ergonomic equipment for their home office.
For companies that want to support holistic health—including mental, physical, and emotional well-being—finding an LSA vendor to provide a customizable and inclusive solution can be hugely advantageous. While they don’t directly reduce out-of-pocket medical costs, they promote healthier habits that can prevent high costs in the first place.
4. Health Reimbursement Arrangements (HRAs)
An HRA is a benefit where employers reimburse employees for healthcare expenses, including insurance premiums, in some cases. HRAs are fully funded by the employer, and you get to decide how much to offer, what types of expenses are covered, and whether unused funds roll over.
This is particularly useful for businesses that want to offer support but aren’t ready for a traditional group insurance plan. It’s also incredibly adaptable for remote or multi-state teams.
5. Debt Assistance Programs
Medical debt is a growing problem, even for insured workers. Some companies are now offering programs that help employees pay off medical bills or negotiate with providers.
Other versions include student loan repayment assistance (especially useful for healthcare workers and younger employees), emergency savings matching, or access to low-interest personal loans for unexpected expenses. These programs show employees that you’re not just invested in their work, but also in their ability to manage life outside of it.
6. Price Transparency Tools
One of the simplest ways to help employees reduce costs? Give them the information they need to make smarter choices.
Employers can partner with platforms that show real-time pricing for medical procedures, prescription drugs, and even provider quality scores. This empowers employees to compare prices, choose in-network providers, and avoid financial surprises.
Some insurance carriers offer this directly, but third-party services can enhance transparency further, especially if you’re working with multiple plans or decentralized teams.
Financial Wellness = Business Wellness
It is not a selfless thing to enable the employee to take charge of their out-of-pocket healthcare costs, but a strategic value-add. When individuals are not sinking under medical bills or intimidated to visit the physician because of the fear of the bill, they report to work more concentrated, more active, and more dedicated.
They also appreciate that their employer sees them as a whole person, not just a worker.
If you’re looking to evolve your benefits strategy, now’s the time to think beyond premiums and deductibles. From FSAs to LSAs, from HSAs to HRAs, you have more tools than ever to support financial wellness, without blowing your budget.
Start by asking what your employees really need. Then, build a benefits package that speaks to those needs, not just what’s been done before.
Because at the end of the day, helping your team stay healthy and financially secure isn’t just good HR—it’s good business.
