While it is one of the largest expenses that a company incurs, employee benefits have countless advantages for growing businesses. When employees have access to a comprehensive benefits package, companies enjoy a higher retention rate, more productivity, improved reputation, increased morale, and lower employee turnover.
While the advantages of having a great benefits program are irrefutable, many businesses struggle to pay for health coverage and other benefits. Fortunately, there are ways that companies can control costs while still giving employees the benefits they want. Benefits consulting services can help businesses find the most cost-effective and appropriate strategies that will support their employee benefits plans.
Americans are Struggling to Pay for Medical Debts Despite Being Insured
Health insurance remains the most sought-after employee benefit in the US. According to KFF, 49 percent of firms with between three and nine workers offer coverage to their employees, while virtually all firms with 1,000 or more employees offer health benefits.
However, despite being insured, many employees continue to struggle with healthcare-related debt. A report from the Kaiser Family Foundation found that 100 million adults currently have healthcare debt ranging from $500 (16 percent) to more than $10,000 (12 percent).
This financial burden can be hard on families, forcing many to cut spending on essentials like food. Millions of people are also being driven into bankruptcy and even from their homes.
Nearly Half of Americans with Employer-Sponsored Health Coverage are Underinsured
While having health insurance is important to stay protected against major medical expenses, having employer-sponsored health coverage is not always enough. According to the KFF, approximately 28.9 million nonelderly individuals are uninsured, meaning at least 70 million individuals in medical debt have insurance but are underinsured.
There are a variety of reasons why many people remain underinsured, such as public program cutbacks, rising healthcare costs and reduction of employer-based insurance options. Premiums for health insurance also continue to rise, often faster than employees’ wages, creating affordability concerns among workers.
High health costs, coupled with stagnant employee wages across many companies, have many employees worried about accumulating medical debt. In fact, adults who are underinsured have some of the highest medical debt problems and often have difficulty paying their medical bills.
The Vicious Cycle of Working Through Medical Issues and Accumulating Debt
Healthcare costs have continued to rise in recent years, partially due to general inflation, the pandemic, tight labor markets, the release of new and costly drugs, and provider consolidation. As medical services become more and more unaffordable for employees, many workers are choosing to avoid trips to the doctor.
Trends in employee healthcare show that more employees are choosing to continue working through their medical issues instead of getting the healthcare services that they need to maintain good health and wellness. Employees often wait until they are seriously ill or injured to see a physician, at which time they experience higher costs.
Employees Who Are Sick Cannot Work Efficiently
Employees often feel pressure to come to work, even when they are ill. Working when sick, whether mentally or physically unwell, is referred to as presenteeism. Presenteeism is becoming increasingly common in the workplace. A recent HBR study revealed that the cost productivity loss due to presenteeism exceeds more than $150 billion annually.
Working while sick can actually be more harmful than an absence. Employees who are ill at work are often less productive and unable to work efficiently. This can lead to slowdowns in production and significantly increases the risk of errors and inaccuracies in work activities.
Employees Who Can’t Afford Their Medical Bills Will Look for Other Employment
Employer-provided health coverage plays a key role in employee recruitment and retention. According to a survey published by the Society for Human Resource Management (SHRM), 56 percent of US adults who have employer-sponsored health benefits revealed that whether or not they like their health coverage is a key factor in deciding to remain at their current job.
Listening to employees and what they need in employee benefits can help reduce employee turnover and increase loyalty to the company. Without access to appropriate healthcare coverage, many employees who cannot afford to pay their medical bills may look for employment elsewhere.
Developing a Health Coverage Plan That Is Cost-Effective and Meets Employee Needs
Managing employee benefits that include a suitable health coverage plan remains a top priority for many employers. However, businesses must find a careful balance between developing a plan that is cost-effective while still meeting employee needs. One of the best ways to achieve this goal is by working with a benefits consultant.
With help from an experienced benefits consultant, employers can better identify the organization’s benefits objectives and set a realistic budget. Conducting a needs assessment can also be useful for determining the best benefits selection and design based on employee wants and needs.
A benefits consultant can also help in other critical areas, such as formulating a benefits plan program and communicating the benefits plan to employees.
Companies Are Leaving Money on the Table When They Don’t Get Benefits Consulting to Restructure Programs
Benefits consultants perform a variety of services for businesses, such as helping companies select and implement benefits. In turn, working with employee benefits consulting firms can actually help employers save time and money by giving them direct access to excellent benefits packages that will attract and retain top talent.
While the upfront cost of hiring a benefits consultant may be off-putting, the improved productivity of a company’s workforce makes the investment worth every penny. Benefits consultants are experts in their field and can help companies choose benefits that save them money while also meeting employee healthcare needs.
Benefits Consultants Can Help Teach Employees About Program Offerings for a Higher Adoption Rate
Benefits consultants have the knowledge and expertise not only to help employers but also employees. Companies can choose to hire a benefits consultant to help teach employees about available program offerings and encourage them to participate in these plans.
Healthcare enrollment options and procedures can often be complex and many employees may feel uneasy about signing up for a program that they do not completely understand. With guidance from a professional benefits consultant, companies can often achieve higher adoption rates.
As a result of this education, employees are often healthier, happier, and more productive at work. Affordable healthcare can also reduce the stress associated with healthcare expenses and employees are more likely to be positive and engaged at work.
Run a Company With Leading Benefits Programs by Speaking to a Benefits Consultant
America’s healthcare system is not fully comprehensive, even for individuals who obtain health insurance through their employer, according to a new survey by the Commonwealth Fund. Employee benefits consultants specialize in developing benefits packages for employers that are tailored to their unique needs. With help from a reputable benefits consultant, businesses can experience a positive impact on employee morale and gain the upper hand when recruiting new employees.
Benefits consultants can also provide other key benefits, such as financial savings, fewer compliance issues, well-negotiated contracts, and assistance for employees when navigating benefits options and enrollment. To learn more about how to save on costs with a benefits consultant, request a consultation online or call New City Insurance at 888.210.2765.