Employers were once focused on the bottom line and cost savings when it came to healthcare and employee wellness. Healthcare costs have continued to increase since 2015 by an average of 6% for large employers who do nothing to curb costs and by an average of 5% for large organizations that do implement cost savings strategies. Healthcare has a significant impact on an organization’s bottom line, so finding ways to reduce costs makes sense. Organizations are realizing, though, that cost savings should not correlate with a degradation of the health benefits offered to employees.

Cost savings isn’t the key factor when it comes to employee wellness. Employees who feel well physically, mentally, and emotionally, are happier and more productive. Per the Internal Foundation of Employee Benefit Plans (IFEBP) Workplace Wellness Trends 2019 Survey Report, 82% of employers are motivated to improve overall worker health and well-being, and only 18% hope to minimize healthcare costs. This is a huge shift away from the trends of the past few decades when cost was the driving factor.

Wellness programs have garnered a fair amount of attention in recent years. With the consistent increase in healthcare costs and premiums from year to year, some companies have turned to wellness programs to reduce healthcare and medical costs. Other organizations implement them with hopes of seeing an increase in work productivity and morale. Some implement them as part of their employee value proposition to attract and retain top talent in one of the most competitive job markets, we’ve seen in years while also providing benefits options that meet the needs of the various demographics in the workforce today. Regardless of why an organization is implementing one, the question that eventually comes up is, “Are wellness programs worth it?”

Work-life balance is a goal for individuals from all the generations that make up today’s workforce — from baby boomers, who want to care for aging parents and spend time with their grandchildren, to the Gen Zers, who consider work-life balance to be the second most important value proposition for employers to offer. As a result, employers have to step back and evaluate ways to support employees in achieving the work-life balance they desire.

More and more employers are offering some type of flexible schedule policy to address employees’ work-life balance needs. A 2015 Society of Human Resource Management (SHRM) survey showed that 54% of organizations offer some type of flexible schedule, and 60% offer some sort of telecommuting policy. A 2018 poll by Flex + Strategy Group showed that 98% of employers offered some type of broadly defined flexible hours.

The 2017 State of Telecommuting in the U.S. Employee Workforce Report showed that 2.9% of the workforce, or 3.9 million employees, work from home at least 50% of the time, compared to only 1.8 million in 2005. That’s a 115% increase in telecommuting and remote work from 2005 to 2017. The report also showed that the average telecommuter is 46 years old, which falls within the Generation X population, a generation that’s older than the millennial and Generation Z demographics we think of when we think of telecommuting.     

Here's an update from our ERISA attorney's office, Kutak Rock, concerning recent legislation changes stemming from the recent COVID-19 pandemic: 

On March 18, President Trump signed the Families First Coronavirus Response Act (the “Act”) into law, which calls for free COVID-19 testing, new paid leave entitlements and tax credits to help employers pay for such leave. The following summarizes the Act’s important health and leave-related provisions.

The workforce of the U.S. is more diverse than ever before. For that reason, it’s necessary that employers design a time off program that caters to the cultural and demographic diversity of their employees. Otherwise, retention, job satisfaction, and work productivity could take a hit. 

As a result of this cultural and demographic diversity, time away from work is one of the hot benefits topics for the HR world. It’s no secret that millennials entering the workforce believe that flexibility and time off are important factors when considering a job opportunity and employer. But it’s not just millennials who are seeking time off throughout the year: The baby boomer, Gen X, and Gen Y populations are also seeking a better work-life balance. These earlier generations may want time off to spend with children or grandchildren, and — like millennials — simply to enjoy life. As a result, organizations are looking at their time-off policies to find ways to meet the requests of their employees.

Religious diversity also prompts conversations about time-off policies. Employees are speaking up and requesting time off to practice their religious beliefs and observe their holidays. Though many organizations still offer the same standard eight to 10 holidays off throughout the year, some organizations are looking at ways to offer floating holidays or to allow employees to trade in holidays. These options allow employees to take time off for holidays of their choice.  

Per SHRM, statistics show that employees are remaining in jobs for only 18 to 36 months instead of the historically standard three to five years. Employees don’t like the idea of starting with a limited number of days off and not acquiring more until they meet a particular milestone, which is often three to five years in many organizations.

Medical costs are one of the leading causes of bankruptcy in America, accounting for 62% of cases, according to a Harvard University study reported by Forbes. Medical costs are also one of the top stressors for Americans. In the 13th annual Stress in America survey, two in five adults reported that they previously had difficulty paying for health care, and more than 60% surveyed shared that medical costs are a source of stress for them.

Medical benefits give employees peace of mind by allowing them to take care of themselves and their families. It’s understandable, then, that medical benefits rank high on an employee’s priority list when considering employment opportunities. It’s also understandable that an employer’s benefits plan offerings tie into its employee value proposition. 

There are many factors to consider when deciding on the types of medical plan benefits to offer to employees. Depending on the goals and budget of an organization, there may be several options to choose from, including traditional co-pay plans, high deductible plans, plans accompanied by a Health Savings Account (HSA) or Health Reimbursement Account (HRA), supplemental insurance, catastrophic insurance, critical illness insurance, mental health benefits, dental benefits, and vision benefits. There are also minimum requirements for employers to consider based on certain local and state laws, as well as the Federal Affordable Care Act.

A benefits brokerage firm like KBI can help you determine the best options for your organization and learn about the many health benefit plan options available to you. Continue reading for an outline of some of the benefits plan options organizations can offer as part of their benefits package. 

Due to the growing awareness of the impact of mental health on well-being and productivity in the workplace, employers are thinking more about the behavioral health services they offer to their employees. With the shift in focus to mental health solutions for employees, we’ve seen an expansion of mental health services offered under traditional medical plans, an increase in partnerships between mental health and medical carriers, an increase in virtual or tele-health counseling solutions, and a proliferation of strategies to provide targeted and readily available mental health solutions to employees on-site or nearby. More and more employers are also committing themselves to better educate employees about mental well-being and mental health services.

Regardless of your company’s size, creating a benefits strategy is essential to meeting the needs of your employees and your organization’s budget. Benefits programs are often one of the most substantial costs that employers face. From a monetary perspective, benefits account for approximately 40% of the total compensation package offered to employees.

Allowing your employees to select the personal benefits available to them will hopefully improve retention rates. But they can also cost you due to turnover from employees who leave for a better benefits package. In an SHRM job satisfaction and engagement survey, close to one-third of the respondents shared that they would likely look elsewhere for a job in the next 12 months due to their current employer’s benefits package. To avoid the latter scenario and to create a benefits plan to meet your organization’s budget, consider the following steps as a guide.  

Employee benefits offerings and programs vary between employers. However, standard offered benefits include medical insurance, retirement plan benefits, life insurance, disability insurance, paid time off, tuition reimbursement, dental insurance, and vision insurance. Many companies offer additional benefits options and company perks. Although benefits are important to employees, it might be surprising that employees are often left uninformed of every perk and benefit available to them through their employer. Additionally, it is also common for employees to passively select their benefits without obtaining the right information.

An employee value proposition (EVP) is offered by organizations to employees for their skills and experiences. One component of an organization’s EVP is the benefits it offers to its employees. In a Society for Human Resource Management study, nearly 90% of participants reported that benefits impacted their overall job satisfaction, and one-third considered leaving their current employer in the next 12 months for a job with better benefits. There’s no denying that good benefits help attract and retain employees in a competitive job market.

Given that the cost of healthcare is a leading cause of stress for Americans, medical benefits are still a priority for employees. If an unforeseen medical event occurs, employees want to know that they and their dependents are taken care of without the extra stress of having to wonder how they’re going to cover their medical expenses.

With the cost of medical insurance on the rise, however, businesses of all sizes — especially small businesses — must find creative ways to offer cost-effective health benefits to employees. Fortunately, there are health reimbursement accounts, health savings accounts, medical expense reimbursement plans, and high-deductible plans that can make providing employee health benefits more affordable. There are also additional affordable benefits that employers can offer to attract and retain employees as part of their EVP.