Why you can’t afford not to offer health benefits
Originally posted January 14, 2014 by Larry Boress on https://ebn.benefitnews.com
The debate continues on the future of employer-based health benefits as employers continue to be challenged by the economy, the health care delivery system and changes resulting from the Affordable Care Act. There are some who believe this is the beginning of the end for employer-based health care benefits. I’m not one of them.
Why are employers still offering health care benefits and increasing worksite wellness activities? It’s not rocket science. Employers don’t offer benefits because they are altruistic. They do so primarily to recruit and retain talent and to ensure workers have the mental and physical capacity to perform their best on the job.
With benefits being the second highest expense after payroll, and the foreboding 2018 excise (“Cadillac“) tax on benefits above a certain dollar level, there is a great need for employers to reduce their outlay for medical expenses. Businesses are addressing this in multiple ways, including increasing programs to identify disease and health problems early in their progress and to reduce the risks for those with chronic conditions.
Employers have increased deductibles and co-pays of their health benefit programs, with close to 30% now offering only health savings accounts and health reimbursement accounts. In a new development, according the Private Exchange Evaluation Collaborative, close to half of all employers will be considering using private health insurance exchanges to offload their benefit administrative costs, while still offering benefits to their employees.
Increasingly, we also find employers are taking a deeper dive into providing direct health programs and services to their covered populations to respond to a health system that fails to offer easy access, effectively focus on prevention or management of chronic conditions and one that doesn’t incentivize individuals to take responsibility for own their health.
The nonprofit National Association of Worksite Health Centers found that close to a third of employers today make medical services available onsite so they are easily accessible to their employees. This allows them to reduce costs while minimizing lost work time due to absenteeism
The existence or even the unlikely repeal of the ACA does not change the value of offering benefits for employers. When you look at Europe, where many countries do not offer health benefits to their citizens, you still find companies offering wellness and preventive services to keep people safe, healthy and productive.
In surveys conducted by the Midwest Business Group on Health, the vast majority of employers agree that there is a link between an employee’s health and their productivity. They believe that health benefits are a necessary cost of doing business and view health benefits as an investment in human capital with measurable outcomes, not just an expense against the bottom line.
If employers are to remain attractive to new talent and retain their existing human capital, they will need to continue to offer health benefits to their workforces. But to do so, businesses must develop comprehensive, integrated strategies that reduce their costs and make employees more responsible for decisions they make about their medical care.
Many employers have already begun to move in this direction by increasing use of outcome-based incentives to motivate lifestyle choices, encouraging use of preventive care, and paying only for high quality providers and high-value, cost-effective treatments and services.
At the end of the day, dropping health care coverage is not an option, especially for employers who are focused on the health and productivity of their workforce. An employer-based system can and should continue if we recognize the value of our human capital being as important as the technology, machinery and plants that develop our products. Regardless of a company’s size, in a global marketplace, a business can’t afford to lose its most important assets – its people.
A top focus for 2014: talent retention
Originally Posted January 6, 2014 by Wendy Keneipp and Kevin Trokey on https://eba.benefitnews.com
Many would predict the top trend of 2014 to be some new cost-shifting strategy, voluntary product, or the pushing of employees to the exchanges, something that has to do with the employer, writing a check or the avoidance of writing a check.
However, the trend that we see for 2014 is largely focused on the interaction between employers and employees. We see a shift away from the myopic focus on health care plans and core benefits to a larger view of embracing the pre-recession focus on employee attraction and retention.
Several factors are aligning to, once again, drive this focus. The result will be a perfect storm of turnover; making attraction and retention a top concern for businesses.
Jobs numbers are trending positively. Baby boomers are going to be retiring in significant numbers and many employees are more than anxious to find a new employer. Add to those realities the recession-forced lesson of how to do more with less and employers will have to face the reality that they need their high performers more than ever before and they need the high performers more than the high performers need them.
The most insightful of employers will identify their best talent, start engaging that talent in ways that will repair the tenuous ties that currently bind them to the organization and start putting the pieces in place to ensure their long-term retention. These same, insightful employers will also become more purposeful in identifying the key talent they need to attract. As with the retention of existing key talent, companies will have to develop and execute on a purposeful attraction strategy to ensure that the key talent chooses them.
The best talent will seek out employers with strong cultures and with whom they find a cultural fit, who will provide access to the right training, and who will continually provide opportunities for personal and professional growth.
For employers, this perfect storm isn’t only going to make attraction and retention of the best talent a competitive advantage; it is going to make it necessary for their very survival.
The game is about to get significantly more difficult for employers. Up until now, they were in control and, they found most of their answers tied to their checkbook. The answers of the not too distant future are much more complicated than a checkbook; they are about creating healthier organizations that are powerful magnets to the best talent in the market.
Now, that is a trend worth getting excited about.
For a gallery of what other experts see as the top health care trends in 2014, click here.
Employees' top 10 desired perks for the workplace
Source: https://eba.benefitnews.com
Since 32% of employers reported that top performers left their organizations in 2012 and 39% are concerned that they'll lose top talent in 2013, many are asking current employees for feedback on how to increase job satisfaction. According to a new CareerBuilder survey, 26% of workers said that providing special perks is an effective way to improve employee retention. Here are the 10 that scored highest when workers were asked to identify one perk that would make their workplace more satisfying.
1. Half-day Fridays
The top choice for 40% of employees surveyed was early dismissal on Fridays. According to Mercer research, work-life balance could recharge employee engagement and help retain employees.
2. On-site fitness center
Twenty percent of workers said providing easy access to gyms would increase their job satisfaction. A HealthFitness expert offers 10 tips in this slide show for building and sustaining a culture of health in the workplace.
3. Ability to wear jeans
Having a casual dress code was the most preferred perk by 18% of employees and doesn't cost employers a dime to implement.
4. Daily catered lunches
On the other hand, 17% of employees wished their employer would provide daily lunches, which could improve productivity in addition to satisfaction if workers don’t need to leave the office to buy food.
5. Massages
Employees who wanted massages to relax in the workplace (16%) may be on to something as experts claim massage therapy can boost morale, increase productivity and even help with attraction and retention.
6. Nap room
The Huffington Post and Google have created napping rooms or pods in their offices, a perk that 12% of employees wanted most, according to CareerBuilder. Arianna Huffington said “I love seeing our hard-working reporters disappear into the nap room,” and joked: “We haven’t seen any disappear in pairs yet, but we’re watching for it!”
7. Rides to and from work
Not only could office-provided transportation or organized carpooling save employees stressful commutes, sharing a ride could help them save money on transportation or fuel costs. No wonder 12% desire this perk most from their employers.
8. Snack cart that comes around the office
Having a snack cart patrol the office would permit employees to munch happily while never leaving their desks. Eight percent of employees said this perk would most improve their job satisfaction.
9. Private restroom
Having their own restroom would make 7% of workers very appreciative, though employers may have trouble giving this perk to every employee.
10. On-site daycare
Home Depot agrees with 6% of workers that on-site daycare is a perk worth having. The company’s onsite child care facility has space for 278 children and is available to all employees in the Atlanta area, not just those who work at the head office.
Hiring rises while employee engagement falls
Source: https://www.benefitspro.com
Although employers are hiring more workers, employee engagement is down, according to Mercer’s 2012 Attraction and Retention Survey.
In fact, more than 40 percent of respondents report that they are bringing in more employees in 2012 as opposed to 27 percent in 2010, and 16 percent of respondents are cutting staff compared to 25 percent in 2010. Still, 24 percent of respondents say they are seeing lower levels of employee engagements, a jump from 13 percent in 2010.
“Employee loyalty has been eroding the past few years due to companies’ responses to the economic downturn,” says Loree Griffith, principal with Mercer’s rewards consulting business. “Actions like layoffs, pay freezes and limited training opportunities have created an evolving employment deal for employees due to uncertainty about what is expected and how employees will be rewarded. Meanwhile, firms are still aggressively managing people costs while finding ways to re-energize and re-motivate engaged employees.”
Turnover is a major contributor to the attention employers are giving employee engagement as nearly 60 percent of respondents expect to see higher voluntary turnover with the job market and economy improving. Certain jobs are in higher demand than others because of skills shortages and market demand. Among these positions are information technology, research and development and scientific engineering, and executive level and top management.
“Employees with the ‘right’ skill sets are in demand,” says Griffith. “Despite the increase in hiring, many firms are experiencing talent shortages due to critical gaps between skills employees possess and skills businesses need. Now more than ever, firms need to engage and develop their high-potential employees and critical work force segments.”
Both cash and noncash rewards remain an important part in strengthening employee engagement and retention, and this is especially true as many employers are cutting base pay increases and offering smaller bonuses, the survey finds. Merit increases are particularly popular as 95 percent of respondents providing some form of increase for 2012.
Of the noncash reward programs implemented by organizations over the past 18 months, are communicating total reward value to employees at 25 percent, use of social media to boost the employee work experience at 25 percent, formalized career paths at 22 percent, internal and external training at 22 percent and special recognition at 22 percent. These responses are similar to those from 2010, although more respondents are relying on social media and team building.
Despite the higher use of noncash rewards, respondents expect the top rewards that drive employee engagement and retention in 2012 to be base pay increases at 50 percent, vertical career progression at 47 percent and leadership development at 46 percent. Rewards that are expected to have a moderate impact on employee engagement and retention are variable pay, health care benefits, work-life programs, performance management, time-off programs and training.
“While noncash programs, like work-life initiatives and formal career paths, are important for employee engagement all the time, employers must revisit pay in light of the changing business environment to stay competitive, retain their top-performing employees and ultimately buy or build required skills for the future,” says Jeanie Adkins, partner and segment co-leader of Mercer’s rewards consulting business.