Offering health insurance coverage will continue to challenge employers from several fronts: complying with health care reform regulations, controlling the increasing costs, and attracting and retaining employees.
MSEC’s 2013 Health and Welfare Survey, based on data collected January 2013, showed that 100 percent of employers surveyed currently offer health insurance benefits to employees. However, a 2014 Colorado Employee Benefits Survey by Lockton Companies, based on data collected in the fall of 2013, showed that only 89 percent of employers surveyed intend to continue to offer this coverage to employees in 2014. The Lockton survey also showed that 86 percent of employers expect to pass on a portion of the increased cost of their medical insurance premiums to employees, up from 75 percent in 2013.
While these surveys show that employers are thinking about reducing coverage offered and passing on more costs to employees, a survey of employees showed that they highly value health insurance benefits. In that survey, 88 percent of employees ranked employer-provided health insurance as extremely or very important. This percentage was higher than any other workplace benefit according to the 2013 Health and Voluntary Workplace Benefit Survey by Employee Benefit Research Institute (EBRI) and Greenwald and Associates.
With the individual mandate taking effect in 2014 and employees looking at the impact of premium cost sharing on their paychecks, health insurance benefits will become an even greater factor in employees’ decisions to join, stay, or leave organizations. Therefore, employers need to include strategies to address attracting and retaining talent when making decisions about health care plan design and cost-reduction options. Questions to consider include:
- What is the organization’s Total Rewards philospohy? Total Rewards includes tangible rewards such as compensation and health and welfare benefits as well as intangible rewards such as work-life balance, learning and growth opportunities, meaningful work, and autonomy.
- What rewards do employees value most? How well does your current Total Rewards program meet those needs?
- What effect could potential changes to your health insurance benefits have on employees’ perceptions of the organization’s Total Rewards program? Can you show that the changes you are considering balance out against other tangible and intangible rewards?