I recently worked with a relative to review their benefits from a new job that they had started. (This has become a common request of me from my family in recent years, as most of my days are spent working with organizations to design benefits and communication strategies for their workforce.)
My relative is 52 years old and has only a spouse to think about when it comes to choosing benefits through his employer. When I asked him how he had done his benefits in the past, he scratched his head and said, “Honestly, I’m not exactly sure, I’ve had the same ones for 35 years.”
This is a common refrain for many American workers, and one that points out the need for employers to evolve their thinking about benefit offerings and communication.
Today, in the age of online car shopping, travel comparison sites and personalized entertainment, people have become accustomed to being empowered as consumers. And increasingly, they want that to extend to their health care and benefits.
As an employer, it's important for you to acknowledge and encourage this mindset when you're planning out your benefits program.
Here are three reasons why:
1. Four generations are colliding in the workforce.
The days of a "one-size-fits-all" health plans are gone. The needs of a 24-year-old recent grad are quite different than a 54-year-old tenured employee. Older generations that have grown up in the "buffet style" health care landscape of HMOs and low deductible PPOs are now compelled to actually shop and compare benefits just as they would any other consumer product. Then you have the younger generations who are accustomed to shopping online for everything, demanding consumer-centric decision support tools and increased transparency.
Designing the enrollment experience to be a familiar online shopping experience can encourage employees to take on that consumer mindset for their benefits selection.
2. Employee health plan costs are universally on the rise.
According to the Benefitfocus State of Employee Benefits 2017 report, regardless of health plan, employees are paying more for their health care.
Employee-paid premiums for high-deductible health plans (HDHPs) increased by up to 12 percent year over year, such that the average HDHP premium is now less than $50 lower per month than that of a PPO.
Meanwhile, deductibles for PPOs rose by double digits, as well, coming to within only a couple hundred dollars of the IRS definition of an HDHP.
With this across-the-board increase in financial responsibility, employees need access to comparison tools and cost estimators during the enrollment process, so they can more easily select the plans that are best fit to their health and financial needs.
3. Workers are financially vulnerable.
Nearly 70 percent of Americans say they have less than $1,000 in savings. The deductibles mentioned in the previous section can greatly exceed that, leaving employees at risk of turning to their 401ks or payday loans to cover unanticipated medical events.
The good news is that there are voluntary programs that have been created precisely to prevent that. Plans like hospital indemnity, critical illness and accident specifically target the “deductible gap” that’s begun to emerge for the majority of workers. Plus, non-traditional benefits are growing in popularity to cover other "emergency" situations, including legal insurance, pet insurance and emergency loan assistance.
Health care consumerism is not just a trend, but a necessary mindset shift to help your workforce to protect themselves from financial hardship. They're looking to you for protection, so make sure your benefits strategy is keeping up with their needs.
Find out more about how you can design a benefits package that is more in tune with your workforce of health care consumers. Join our webinar on financial wellness tomorrow.