90% of People Have Low Health Literacy–And It’s Costing Health Plans

It’s an all-too-common scenario: when your members finally get in to see the doctor but they leave feeling more confused than when they walked in. Maybe they’re unsure why a specific test was ordered or a new medication was prescribed. Or, even worse: they don’t know what’s covered under their health benefit and what it may cost.

Your members are not alone. After all, healthcare is complicated and can be confusing for even the savviest of consumers. In fact, low health literacy affects nearly 9 out of 10 adults1 and costs the healthcare system up to $238 billion2 every year.

While low health literacy is a complex issue with many factors at play, identifying ways to break down barriers, provide advocacy and support, and communicate and engage with members in the right place and at the right time can go a long way.

The Impact of Low Health Literacy

Members with low health literacy are less likely to adhere to their care plans and prioritize their follow-up appointments. As a result, low health literacy can lead to:

  • poor outcomes
  • medication errors
  • unnecessary ED visits and hospitalizations
  • high costs

Plus, health literacy isn’t only about a member’s understanding of their condition, it can also include their grasp on health insurance. In fact, one-third of working Americans3 don’t understand their benefits and an even larger number of Medicare Advantage members4 say the same.

Low health literacy can lead to high costs for payors—to the tune of approximately $4.8 billion a year.5

This lack of understanding means people are not equipped to make informed decisions about the type of health plan they should choose, the premiums and out-of-pocket costs they will have to pay, and what providers and services are covered by their chosen health plan.

Low Health Literacy Barriers

Low health literacy is a complex issue with many factors at play—here are a few.

Socioeconomic status
Research shows lower socioeconomic status is consistently associated with poorer health literacy.6 Since those living in poverty can experience barriers to accessing quality care and seeking out preventative care, there are fewer opportunities for providers to identify needs and educate patients about their health risks.7

Limited English proficiency
An estimated 25 million people8 in the U.S. have limited English proficiency (LEP) and have challenges understanding and accessing basic health information and preventative care, and obtaining and navigating health insurance. Low health literacy and LEP are associated with inappropriate testing, missed diagnosis, ED utilization, and low adherence to care plans.9 What’s more, LEP populations may have low health literacy in English as well as their native languages—making navigating the healthcare system all the more challenging.

Cultural beliefs
Cultural values, beliefs, practices, and attitudes can all shape a person’s understanding of their health conditions, care and treatment, and the ability to communicate with providers and access care.

Education and healthcare knowledge
Limited education and a lack of healthcare knowledge can impact a person’s ability to engage in their care. For example, members may not understand why they need to take a medication, how to take it, or how long they will need to wait to see improvement in their symptoms. They may also worry about what to do if they experience side effects from the medication.

Yet health literacy can also affect anyone regardless of their level of education. In fact, 48% of those with low healthcare literacy5 completed college or hold a graduate degree.

How to Improve Low Health Literacy

As payors continuously look for ways to improve engagement, addressing the multiple layers of low health literacy has become a key focus.

Medicare Advantage plans are often looking at ways to improve members’ understanding of their diseases or health benefits, but they also need to be mindful of physical limitations such as, cognition, vision, or hearing that could impact their understanding. Making health information easier to digest, providing support, and meeting members where they are can drive engagement.

Improving health literacy could save Medicare $25.4 billion each year and prevent 993,000 hospital visits.10

Simplify Communications and Experiences

Providing clear, concise communications that are devoid of jargon and that members can understand is important for drive engagement for members with low health literacy. For example, a member’s benefits page should easily describe the services covered and how to access them.

Something else to keep in mind is that older adults may not have access to digital channels to access care, patient education, and benefits information. In fact, one in 4 adults over 65 do not use the internet and more than 35% lack home broadband, according to Pew Research.11 Older adults also have lower levels of digital literacy than younger people.12

As we become more technologically advanced, the disconnect will become even wider. Therefore, using a multi-channel engagement strategy is key.

Support Members with Culturally Competent Care

In order for the member to follow the care plan, engage, or use their benefits, they must understand the care goals, how they align with their beliefs, and how to achieve them. While some members may have family or friends who can offer support, oftentimes caregivers may also struggle with understanding how to help.

A key element of improving health literacy is to support members and caregivers with compassionate, culturally competent care. Whether it’s identifying a language barrier, or level of understanding, having the ability to distill the information in a way the member can understand will lessen the confusion. With a focus on cultural competency, care teams are better equipped to identify and address non-clinical needs in a way that builds trusted relationships and improves outcomes.

Engage with Members at the Right Time

The home and community continue to evolve and provide unique opportunities for members to overcome health literacy barriers and engage in their care. For example, engaging with members at discharge and upon their transition home can help them better understand and adhere to their care plans, including the importance of follow-up visits and how to correctly take their medications.

Retail pharmacists can also play an important role in helping members address health literacy challenges. Through one-on-one consultations, pharmacists can provide information and answer questions about medications. Since pharmacies employ local pharmacists who are likely to speak the language and understand the cultures of the community, they can help to provide directions in a member’s language, which can prevent errors and adverse outcomes. Because at the end of the day, medication is so much more than just giving someone a prescription.

Learn more about how one of our nurse coaches has helped members overcome some of the barriers during their transition home.


EDRC 2083


  1. “Talking Points About Health Literacy.” Centers for Disease Control and Prevention, 2021.
  2. “Impact of low health literacy on patients’ health outcomes: a multicenter cohort study,” BMC Health Services Research, 2022.
  3. “Voya Survey Finds One-Third of American Workers Don’t Understand the Benefits They Selected During Open Enrollment,” Voya Financial, 2021.
  4. “Medicare Advantage Satisfaction Index,” Retirement Living, 2023.
  5. “The hidden cost of healthcare system complexity,” Accenture, 2018.
  6. “Understanding and Responding to Health Literacy as a Social Determinant of Health,” Annual Reviews of Public Health, 2021.
  7. “Why Even Healthy Low-Income People Have Greater Health Risks Than Higher-Income People,” The Commonwealth Fund, 2018.
  8. “Overview of Health Coverage and Care for Individuals with Limited English Proficiency (LEP),” KFF, 2023.
  9. “Addressing Low Health Literacy and Limited English Proficiency,” American Academy of Pediatrics, 2021.
  10. “Health Literacy Key to Better Health Outcomes,” United Health Group, 2020.
  11. “Share of those 65 and older who are tech users has grown in the past decade,” Pew Research Center, 2021.
  12. “A digital media literacy intervention for older adults improves resilience to fake news,” Scientific Reports, 2022.