Harris Interactive Releases Telephone Survey for the American Institute of CPAs [Professional Services Close – Up]

As Americans prepare to make critical decisions about health insurance, a majority are struggling to understand basic financial terms found in the plans, according to a new telephone survey conducted for the American Institute of CPAs by Harris Interactive.

According to a release, the telephone survey of 1,008 U.S. adults conducted late last month found that more than half, 51 percent, could not accurately identify at least one of three common health insurance terms: premium, deductible and copay. A third, 34 percent, thought a premium was an expense at the time of receiving medical service or a prescription; more than a quarter, 27 percent, thought a copay was the cost of obtaining insurance; and 12 percent did not know a deductible is the money one pays before an insurance company makes payments.

"Half of Americans would fail health insurance 101," said Ernie Almonte, CPA, chair of the AICPA's National CPA Financial Literacy Commission. "That's critical insight as consumers prepare to make important decisions with implications for both their physical and fiscal well-being. Americans need to take time in the coming weeks to familiarize themselves with key terms and assess their needs so they make the best decisions for their health and financial situations."

The Affordable Care Act, commonly called "Obamacare," requires individuals to buy health insurance or pay a penalty beginning next year, with open enrollment starting in October. Despite the coming milestone, the survey found limited knowledge of the healthcare law and its implications. Forty-one percent said they are not at all knowledgeable about the law and another 48 percent said they were only somewhat knowledgeable. Young people were the least knowledgeable, with nearly half, 48 percent, of adults aged 18 to 34 saying they had no knowledge.

For 11 percent of U.S. adults, the upcoming requirement to buy health insurance is their biggest financial concern. For half of the small minority who don't have health insurance - 14 percent, according to the survey - figuring out how to pay for it is their biggest concern about the mandate.

The American Institute of CPAs (AICPA) is a member association representing the accounting profession, with more than 394,000 members in 128 countries and a 125-year heritage of serving the public interest.

More information:

360financialliteracy.org

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