Jun 14, 2022
Employers are trying to expand benefits and manage healthcare costs in a very challenging environment. They’re facing the continuing COVID-19 pandemic, record employee attrition, the need to adapt to a growing focus on diversity, and rising healthcare costs, according to a survey by McKinsey.
Benefits Get a Closer Look
Compared to before the pandemic, there has been an 11% increase in employers who say that benefits are very important in talent management. This highlights the intense competition for talent and the growing need for employers to optimize employee benefits.
Employers Are Looking Beyond Costs
When selecting benefits carriers, employers say that cost is less important than it was five years ago. At the same time, 60% have experienced healthcare cost increases that outpaced inflation in the past three years. Sixty-three percent expect that trend to continue, signaling potential cost challenges in the future.
Employers are looking for ways to improve member satisfaction and manage costs, such as health management and member advocacy. This balanced approach is likely to endure after the pandemic. Third-party vendors and health insurers typically offer these kinds of health management solutions to improve the member experience and manage medical costs. Member advocacy solutions offer members a single point of contact to improve care navigation and satisfaction.
Employers Are Using These Cost-Management Strategies
Employers have several options to strengthen the quality of their benefits packages while managing costs, such as the following:
1. Health Care Navigation Tools: These tools help employees navigate the healthcare system, such as finding culturally sensitive care, getting preventive physical and mental care, and managing chronic conditions
2. Contracting Arrangements: They’re entering innovative contracting arrangements with healthcare providers
3. Employee Communications: Employers are looking to communicate benefits information to employees in simple language, in multiple channels, and year-round. This includes tools to help employees select and enroll in benefits that meet their needs and help them manage out-of-pocket costs
High Deductible Health Plans (HDHPs) Remain Popular
Employers continue to see the HDHP as a viable option to manage rising medical costs, and they’re increasingly satisfied with these plans. High-deductible health plans are among the top three plans offered by surveyed employers.
Voluntary Benefits Are Becoming Increasingly Important
Employers view voluntary benefits as increasingly important with 78% offering at least one option. Employers are offering voluntary benefits to support employee well-being, enrich core benefit plans, and attract new employees.
