Okay, if people are willing to give up some benefits to lower their premiums, what else are they willing to trade? Here are some of the survey highlights:
What happens to the savings? Defined contribution also permits employees to cash out once they have purchased their insurance. So if an employee has $2,000 to purchase health insurance and only spends $1,500, then the remaining $500 is "found money"—albeit taxable. But 57% of survey respondents say they would not take the cash-out option, and instead would spend those dollars to purchase ancillary health benefits such as vision and dental coverage, and even life insurance and disability benefits.
We are talking billions of leftover cash—what Birhanzel terms "discretionary premium dollars." Accenture estimates this new pool of money will grow to $4 billion by 2018.
"We see interesting growth opportunities in this ancillary benefit space that didn't really exist before for this population because it didn't have the opportunity to make these trade-offs," says Birhanzel.