Retirement plan sponsors are the first, and most important, line of defense in providing employees with well-managed retirement savings plans.
The jobs report for the first month of 2023 showed a very strong start to the year, with nonfarm payrolls increasing by 517,000—the most significant gain since July 2022.
Michelle Meyer, Chief Economist at Mastercard Economics Institute, recently told CNBC, “It was a phenomenal report. This brings into question how we’re able to see that level of job growth despite some of the other rumblings in the economy. The reality is it shows there’s still a lot of pent-up demand for workers where companies have really struggled to staff appropriately.”
In other words, the ultra-competitive job market we’ve been experiencing for the past couple of years shows no signs of abating. This means employers will still need to seek creative, effective ways to stand out to applicants and recruit top talent.
Health insurance remains the most popular and sought-after benefit, with 71% of private industry workers currently having access—with the Bureau of Labor Statistics reporting that health benefits were available to 71% of private industry workers—the details of each specific plan matter, as do the other elements of the benefits package.
From employer contribution percentages to more non-traditional offerings, like employee assistance and wellness programs, organizations are thinking outside the box to ensure they stand out as a top place to work for future applicants and keep their current employees happy in their roles. In this blog post, we’ll discuss some of the top employee benefits trends to keep an eye on in 2023.
Consumer-Driven Health Plans
Healthcare consumerism is a wellness movement that’s been gaining popularity in the U.S. for the past several years. It is a large-scale effort that aims to make the process of accessing healthcare services more efficient and transparent.
Healthcare consumerism is intended to make using healthcare services more affordable by encouraging employer-sponsored benefits plan participants to become conscious consumers. This will ultimately improve patient outcomes and levels of satisfaction with the medical care they receive and reduce costs within the entire healthcare industry.
According to DataPath, healthcare consumerism is designed to:
- Facilitate communication and collaboration between healthcare providers and patients.
- Improve patient participation and adherence to treatment recommendations.
- Increase patients’ knowledge, understanding, and awareness of healthy lifestyle practices.
- Heighten focus on preventative medicine by encouraging healthy activities and habits.
Healthcare consumerism is transforming employer-sponsored benefits plans by putting plan participants in the driver's seat. When your employees feel empowered and well-equipped to use their own decision-making and purchasing power in their healthcare decisions, they transform from passive benefits users into savvy investors who play an active role in their own health journeys.
Three of the most popular vehicles that enable employees to have more direct control over their healthcare spending are:
- Flexible spending account (FSA)
- Health savings account (HSA)
- Health reimbursement arrangement (HRA)
These accounts are all designed and operate slightly differently, but each provides a tax-advantaged account that allows participating employees to save funds to pay for out-of-pocket healthcare costs. These accounts are largely controlled by the employee, which gives that individual a sense of personal agency and investment in their journey as a conscious healthcare consumer.
Non-Traditional Benefits Offerings
Wellness Programs
Healthcare benefits may grab the spotlight, but employers and recruiters are turning to alternative methods to attract top talent and retain them for the long run. Employee wellness programs are becoming one of these options.
Most healthcare expenses stem from treatable conditions, and a well-designed wellness program can boost workplace productivity, reduce absenteeism, enhance employee satisfaction, and decrease insurance plan costs.
Employers benefit from a healthier workforce, which leads to lower medical plan claims and ultimately reduces premiums paid by both the employer and employees. Investing in wellness programs is not only a long-term strategy, but it also plays a crucial role in the economics of employer-sponsored insurance plans.
Employee Assistance Programs
With the chaos of the pandemic still looming in our rear-view mirrors and the threat of recession on the horizon, many employees are dealing with inordinate amounts of stress, which can contribute to declining mental health.
An Employee Assistance Program (EAP) provides free and confidential assessments, counseling, referrals, and follow-up services to employees that experience personal and/or work-related problems. It’s an additional tool you can have in your toolbox to keep your employees healthy in both body and mind. EAPs also help businesses address organizational components that may be contributing to a negative work environment, enabling them to resolve and prevent those types of issues from occurring.
Improving Benefits Communication
Unfortunately, understanding the ins and outs of health insurance and other benefits can be complicated. Each plan has its own rules about which doctors are in-network, which services are covered and in what amount, and what the co-pay and deductible will be. There is also a lot of healthcare jargon to learn—terms like HSA, primary care, in-network provider, co-insurance, deductible, and reimbursements are complex industry concepts that your employees may not be familiar with.
Effective communication is key to maximizing the impact of your employee benefits program. No matter how robust your benefits package may be, it will fail to deliver the desired outcomes if your employees are unaware of their available options or how to use them. Developing clear and comprehensive communication strategies is essential to ensure your benefits program yields maximum results.
Consider developing an easily accessible guide to health benefits for your employees. Include information like a glossary of terms and helpful infographics to make the information more digestible.
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