Health Shocks Often Derail Financial Stability | PLANSPONSOR – PLANSPONSOR

A growing number of adults are experiencing depression, and even more are feeling less in control of their health and financial lives than in the past, according a recent Cigna Supplemental Health Solutions study. Compounded by financial stress, this loss of health control has long-term implications and can result in an increased risk of chronic illness, Cigna says.

Cigna partnered with Ipsos for its “Regaining Control and Bouncing Back After the Unexpected” study, a piece of research put together to gain a better understanding of the impact a serious health event has on a person’s life. The study surveyed more than 1,000 full-time employees who experienced a negative, unexpected health event within the past three years.

Now more than ever, the ability to maintain or regain control after a serious, unexpected health event appears difficult, if not impossible, the study suggests. During a serious health event, life can be affected in several ways, and about one in three experienced a significant loss of control over some aspect of their lives.

People were more likely to struggle with losing control over their finances and life in general than they were to have struggle with losing control over their actual health care-focused decisions. Notably, about one in five experienced a loss of control over their finances, and for about seven in 10, it took more than two months to regain control. About three in 10 still have not regained a sense of financial control.

The study suggests such a loss of financial control often has a negative impact on a person’s ability to pay everyday household bills (31% cited difficulty) or to afford an important large purchase, such as a car or home (37%). Millennials were more likely to say a health event had negatively impacted their ability to afford these purchases, with 38% and 42% of respondents agreeing to each, respectively.

In addition to financial issues stemming from unexpected health challenges, Cigna found that such issues also had a negative impact on a person’s personal and professional life. During a health event, eight in 10 people said they received support from friends and family, with 30% saying the event had a negative impact on those relationships.

Just over three in 10 say the health event had a negative impact on their work or career advancement. According to the study, one in five needed to leave work during the health event, with 11% having to go on short-term disability, 3% on sabbatical, 2% on long-term disability and 2% having to leave their job completely. The impact was greater for Millennials, with 39% saying the event had an impact on their work or career advancement and 5% saying they had to leave their job.

Supplemental health coverage is often designed to help people when they experience a significant health event, but those who had it did not feel like they understood it or knew how to use it effectively, Cigna notes in the study. Of those surveyed, two in five said they felt knowledgeable about supplemental health insurance and, of those covered, 57% felt knowledgeable about what is covered. Of those with supplemental health insurance, 75% say having the plan provided peace of mind during an unexpected health event, and, for 72%, it made unexpected health events more affordable.