Health literacy is one of health care’s clearest opportunities

Most people in the U.S. have health coverage for at least part of the year. But having coverage and knowing how to use it are two different things. Nearly nine out of 10 adults struggle with health literacy, making it harder to compare options, understand costs and confidently get care.^* This can lead to delayed treatment, poorer outcomes and financial strain.

I recently sat down with two fellow doctors — Yvonne Collins, MD, Associate Chief Medical Officer at CountyCare, and Margot Savoy, MD, MPH, FAAFP, Chief Medical Officer of the American Academy of Family Physicians — to talk about this issue. We agreed that improving benefit understanding is a shared responsibility, and we all need to work together to make information clearer and easier to use.  

Among insured adults

Why understanding benefits matters

Health literacy is about more than knowing terms like “deductible” or “copay.” It’s about knowing how to use your benefits before care decisions cause bigger problems like unfilled prescriptions or surprise bills.

“Most of the time, poor health benefits literacy shows up as confusion,” said Dr. Savoy. “People hesitate to move forward with care because they’re worried about cost. That hesitation leads to delayed care and widening disparities.”

This affects more than members. Employers and health plans see it in:

• Out-of-network visits because referral rules aren’t clear
• Higher-cost medication choices when lower-price options aren’t known
• Avoidable emergency room visits

Confusion about coverage can come up at any point in treatment. Dr. Collins mentioned oncology care as an example. “When patients don’t fully understand their benefits, it can break trust right in the middle of care,” she said. “And it’s a lost opportunity to empower them earlier, before costs escalate for everyone involved.”

Improving health literacy could save

Why confidence doesn’t always mean clarity

There’s often a disconnect between what members think they know about their benefits and what they actually understand. This confidence gap can result in unexpected bills and costly guesswork.

Preventive care is a common example. A colonoscopy may be a covered benefit, but the service may shift to diagnostic if the doctor finds something and takes a biopsy. That can change what the member owes and make the bill feel unexpected.

Providers also need clear, current information. As Dr. Savoy noted, “People don’t always know where to go with questions, so they show up at their doctor’s office — but even clinicians may not have plan‑specific answers.”

That’s where tools like Real-Time Benefits can help. At the point of care, clinicians can see patient-specific pharmacy benefit information including coverage, expected costs and lower-cost alternatives. This helps them guide members to options that fit their plan and budget.

How health literacy creates value

For employers and health plans, better health benefits literacy helps drive:

• Lower-cost, higher-value care choices
• Fewer surprise expenses
• Earlier care when it’s needed

That’s why health education needs to be proactive, simple and ongoing, and not limited to open enrollment or onboarding. According to Dr. Savoy, “Having simple, trusted resources to point members to, especially ones they can absorb in small moments, makes a real difference.”

Tips to improve health literacy

With health literacy, the goal isn’t to turn members into experts. Dr. Collins said, “It isn’t about intelligence or education level. It’s about whether we’ve explained things clearly, repeated them when needed and checked for understanding.”

As an employer or health plan, there are a few practical steps you can take to help your members understand their benefits before problems start.

1. Use plain language. Avoid benefits jargon and define key words simply.
2. Rely on trusted voices. Share information from relatable people and credible sources to increase engagement.
3. Listen and adjust. Ask members for feedback on what's confusing and respond quickly with practical answers.
4. Use bite-size education in different formats. Meet members where they are through videos, websites, emails and brief explainers.

Watch and share

I recently launched a short video series that uses everyday examples to explain premiums, deductibles and out-of-pocket maximums. The first episode features Meredith Williams, MD, of Oscar Health, and can be shared across member channels. More episodes are coming soon.

From confusion to true confidence

Better health literacy can lead to better experiences and outcomes. Members get the right care at the right time, while employers and health plans are in a stronger position to manage costs. Clearer benefits information also helps people move forward with confidence.

At CVS Caremark®, we believe health literacy is a practical way to improve outcomes, simplify health care and build trust. It isn’t a one-time project — it’s an ongoing commitment that creates real value for all.