It’s a familiar complaint. “We offer good benefits and people just don’t use them. They don’t understand what they have. They don’t appreciate it.” If this sounds like something you’ve said, the data suggests a different story. Your employees aren’t undervaluing the benefits. They can’t afford to use them.
When employers watch utilization numbers come in low and enrollment stay flat, the natural assumption is that workers don’t recognize the value of what’s being offered. So the response becomes more communication, more explainer emails, more open enrollment videos, more dependent audits to clean up the rolls.
That approach rarely works, because the problem was never awareness. The problem is that the plan’s cost structure puts it out of reach for a meaningful portion of the workforce.
What the Data Actually Says
A 2025 national survey conducted by Pollfish for Imagine360 polled 2,500 adults, 80% of whom had employer-sponsored health coverage. In the previous 12 months, 38% had skipped or postponed necessary healthcare or medications because of cost. Of those who delayed care, 42% said their medical condition worsened as a result.
These are people with insurance. The insurance exists. They’re not using it. That gap between coverage on paper and care in practice is where most employer benefit strategies fail, and it’s not a communication problem that a better open enrollment video will fix.
The 2025 Aflac WorkForces Report found that 44% of employees couldn’t pay $1,000 in out-of-pocket healthcare costs, and 19% couldn’t afford even $500. Yet 78% of employers in the same study believed their workforce could cover those costs. The disconnect isn’t subtle. Employers think employees can pay. Employees know they can’t.
The most recent Kaiser Family Foundation (KFF) Employer Health Benefits Survey confirms the structural reason why. More than one-third of covered workers are enrolled in plans with a single-coverage deductible of $2,000 or more. For workers at smaller firms, 53% face deductibles of at least $2,000 and 36% face deductibles of $3,000 or more. If your employee has no savings buffer and a $3,000 deductible, the plan is effectively telling them to find $3,000 before coverage begins.
The gap isn’t between what employees value and what they don’t. It’s between what employees have in their checking account and what the plan requires them to spend.
The Enrollment Gap Tells the Same Story
KFF’s analysis of workforce coverage trends found that among workers with access to employer-sponsored health insurance, only 49% of those in the lowest-wage quartile of occupations enrolled, compared to 72% of workers in higher-wage occupations. That’s not a communication problem. Wage and cost-share structure explain most of the gap.
The Financial Health Network reached a similar conclusion in its research on low-wage workers. Among those eligible for employer health coverage who chose not to enroll, nearly half cited cost as the reason. The quotes employers hear from their own employees in surveys tell the same story. “I work enough hours to qualify, but I can’t afford it. I would like to enroll, but I can’t.”
When employers read low enrollment as disinterest, they miss what the data is actually showing them. The plan is working for the employees who can afford to use it. For everyone else, it’s a line item that doesn’t make financial sense.
What Happens When Employees Skip Care
Employees who delay or skip care don’t just stay at the status quo. Their conditions progress. A 2025 ADP employee benefits study found that 26% of workers had skipped needed medical care due to out-of-pocket costs, up from 21% in 2020. Another 22% had stopped or reduced medications. Meanwhile, the percentage of employees not feeling prepared to handle out-of-pocket expenses climbed from 31% in 2020 to 39% in 2025.
Deferred care becomes delayed diagnoses, worsening chronic conditions, missed workdays, and more complicated, more expensive treatment when care does finally happen. Employers see it in absenteeism, presenteeism, short-term disability claims, and next year’s renewal increase.
There is no version of this that saves the employer money. The financial logic of high deductibles assumes employees will become cost-conscious consumers making prudent decisions. What actually happens is that they become non-consumers, avoiding necessary care until it becomes urgent.
The Retention Cost Employers Underestimate
Benefits that don’t work for employees aren’t neutral. They actively cost employers.
A 2025 Selerix survey found that employees satisfied with their benefits are five times more likely to say they plan to stay with their employer. A Payroll Integrations study published the same year found that 58% of employees cited benefits as the reason they were staying in their current role, with strong health insurance named as the top factor by 67% of them.
And in the Pollfish survey referenced earlier, 28% of respondents said they would leave their current employer and accept a pay cut if it meant better health benefits. Put differently, bad benefits aren’t neutral to retention. They actively push people toward the exit.
For industries with high turnover, this isn’t abstract. The SHRM-cited replacement cost of a departing employee ranges from 50% to 200% of their annual salary. If your benefit plan is quietly contributing to voluntary attrition, you’re paying for the same position twice.
Employees who can’t afford to use their benefits don’t stay quiet. They leave. And they tell the next employer exactly why.
What Employees Actually Value
The 2025 SHRM Employee Benefits Survey found that 88% of employers list health-related benefits as “extremely important” or “very important.” Your employees agree. The PeopleKeep 2024 benefits survey found that 81% of employees said an employer’s benefits package was an important factor in accepting or declining a job.
What employees don’t value is a plan they can’t afford to use. They value coverage that pays when they need it, without a deductible standing between them and the exam room. They value primary care visits that don’t require a spreadsheet of running balances. They value being able to fill a prescription without choosing between the medication and groceries.
This isn’t a mystery. Ask your own workforce what they want, honestly, and the answer will be some version of “insurance that actually helps me get care.”
What Changes When the Plan Is Designed to Be Used
For employers with hourly, frontline, or mixed workforces, the fix often isn’t better communication. It’s a different plan architecture entirely.
No-deductible plans, fixed-copay structures, and limited-day plans designed specifically for hourly operations eliminate the cost wall between employees and care. Employees know exactly what they’ll pay at the doctor’s office because there’s no deductible to track, no prior meeting of a threshold before coverage activates. The plan pays from the first visit.
For workforces that mix W-2 employees with 1099 contractors and variable-hour workers, design-driven approaches extend further. Individual coverage HRAs (ICHRAs) and hybrid models give different worker types appropriate coverage options instead of forcing everyone into a single plan that works poorly for most.
None of these are exotic or experimental. They’re just not the default that shows up in a typical renewal conversation.
Questions Worth Asking Your Own Data
- →What percentage of eligible employees are enrolled, and how does that compare to your industry average?
- →Of the employees who are enrolled, how many have actually used the plan beyond preventive care?
- →What does your deductible mean in the context of your average employee’s take-home pay?
- →If an employee asked you honestly whether you’d want to be on this plan at their wage level, what would you say?
The honest answers to those questions will tell you more about your plan than any employee survey. And they’ll make clear whether what you’re offering is a benefit people can use or a line item people can’t.
When the data says employees are skipping care, the problem usually isn’t their judgment. It’s the plan’s design.