Health+Benefits the December 2021 issue

Gen Z Demands Consumer-First Health Benefits

Stronger, simpler and more extensive benefits are front and center.
By Marek Ciolko Posted on November 30, 2021

For years, companies wanting to attract the next generation have been focused on in-person perks: cool offices, a fun workplace culture and so on. But Generation Z is different, and after weathering a global pandemic, they put robust and holistic health benefits at the top of their wish list.

Many Gen Zers may be enrolling in health benefits for the first time, but they’re coming to the table with a strong set of preferences in an industry that has not historically been focused on the consumer. Whether or not you’re ready for it, this generation will redefine what modern health benefits look like. Progressive health benefit partners should work to ensure they’re offering plans that meet Gen Z’s preferences, and we can all get excited for the ways this generation will change our industry for the better.

Who Is Gen Z?

To understand what type of benefits Gen Zers want, we need to first understand their context. Gen Zers were born roughly between 1995 and 2010. An important differentiator for this group is that they are digital natives with little to no memory of a world without smart phones. Their digital beginnings serve as a lens for how they see the world. Ease of use, personalization and efficiency are all cornerstones of this generation that stem from the technology at their fingertips. A second important consideration: Gen Z is far more financially minded and frugal than the millennials and Gen Xers before them. Many of them grew up watching their parents cope with the aftermath of the Great Recession, and as a result, they may be some of the shrewdest consumers yet. And, with many balancing an entry-level salary with expenses such as student loan debt and rent, they’re wary of health benefits that cost them a lot but provide little value.

For years, companies wanting to attract the next generation have been focused on in-person perks: cool offices, a fun workplace culture and so on. But Generation Z is different, and after weathering a global pandemic, they put robust and holistic health benefits at the top of their wish list.

What They Want

Here are five tips for employers who want to attract Gen Z with health benefits that stand out.

Simplicity and Customer Service. Gen Zers are savvy and smart consumers, with high expectations for the quality of services they choose to spend their money on. They also value simplicity and transparency, which creates a particular challenge when it comes to health benefits, which often involve complex and confusing plan designs and coverage loopholes. It is critical for employers to choose benefits advisors and providers who will work to ease these burdens and not add to them. Start by scrutinizing your company’s health benefits experience from the eyes of a Gen Zer. Is the enrollment process clunky and confusing, or is it a streamlined online experience that’s straightforward and easy to understand? If a participant has a question, can they reach out via online channels at their convenience, or are they relegated to archaic phone lines with long hold times? From choosing a health plan to navigating bills, explanations of benefits, in-network doctors and clinics, online care options and more, choosing solutions that offer superior customer service and user-friendly tools that make benefits easier to navigate will set your clients apart in the eyes of Gen Zers.

Straightforward Plan Design. As financially minded consumers, Gen Zers are exceedingly wary of loopholes and “gotchas.” They are focused on value and don’t want a plan that will stick them with an unexpected financial liability. They increasingly reject the traditional model of high-deductible health plans that expose consumers to the unpredictable pricing that plagues the healthcare industry, and they favor streamlined plans that offer certainty and easily communicate and demonstrate value from the beginning. At Gravie, our Comfort solution offers an example of how health plans can be designed to be more straightforward. With Comfort, individuals have 100% coverage on most common healthcare services from day one, including preventive care, primary care, specialist visits, labs and imaging, generic prescriptions, online care and more. Benefits providers hoping to win with this next generation will develop plans that offer similarly straightforward coverage.

More Expansive Coverage. Younger generations, especially, are increasingly interested in health benefits that go beyond what’s typically covered under traditional health plans. From chiropractic to specialty care, and mental health to online care, consumers want a wider range of services covered by their plan. For example, research by WebMD found that Gen Z and millennial employees are generally three to five times more likely to make use of well-being programs than Gen Xers or boomers.

It’s also worth briefly noting that, in the wake of the pandemic, Gen Zers no longer view telehealth coverage as optional. From their perspective, the convenience and accessibility of telehealth should make it a pillar of standard health benefits plans for years to come.

For example, research by WebMD found that Gen Z and millennial employees are generally three to five times more likely to make use of well-being programs than Gen Xers or boomers.

Strong Mental Health Services. While Gen Zers want alternative forms of healthcare covered, they consider mental health coverage as a “must have.” One major strength of this generation is the unprecedented weight they place on mental health. In fact, according to the American Psychological Association, Gen Z is more likely than any other generation before it to have received mental health treatment or gone to therapy. It’s something we all can learn from and incredibly important to ensure these services are covered in their health benefits.

Willingness to Engage in Dialogue. Finally, a trademark characteristic of Gen Zers is that they want their voice to be heard. Today’s young people truly believe dialogue will improve the world. As you think about enrollment season, consider whether the partners you have are ready and willing to listen to this young group of activists. They expect to be listened to, and they should be if we really want to improve the experience of and access to health benefits moving forward.

The Future

The guiding principle here is we need to flip the traditional model of health benefits on its head. As we consider the future of the industry, we need to consider the workforce that represents it. Gen Z is here, and its members want stronger, simpler and more extensive health benefits than any generation before. They’ll challenge our industry more than ever to level up and put the consumer back in the center, and we can all expect the future of the industry to be better for it.

Marek Ciolko is co-founder and CEO at Gravie.

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