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Employers hone in on affordability and access for 2023 benefits

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Employers of all sizes are looking to bolster their health benefit options in 2023 with an eye toward improving recruitment and retention, and will focus on affordability and access, according to a new Mercer survey.

More than two-thirds of the 700 respondents said they were looking to enhance their health and benefit offerings next year. In all, 61% of participating U.S. employers are conducting surveys on employee benefit preferences.

Mercer’s recent 2022 Global Talent Trends study found that more than 50% of U.S. employees surveyed say not being able to work remotely or hybrid permanently is a deal breaker when considering whether to join or stay with an organization.

Employers have recognized this, and the new Health and Benefits Strategies survey found that currently, 78% of participating U.S. employers provide the option to work from home regularly, compared to 26% last year, and 66% are allowing flexible work schedules – even including a four day work week.

According to the survey, health benefit strategies today are focused less on reducing healthcare costs and more on supporting the emotional, physical, social and financial well-being of employees. Virtual care is now playing an increasingly central role, given its potential to replace some in-person care with lower-cost virtual services, and engage employees through channels with which they are comfortable.

While traditional telehealth services – a critical source of care during the pandemic – are now offered almost universally, the majority of survey respondents will offer virtual care solutions beyond telehealth in 2023, with more than half of large employers (52%) offering virtual behavioral healthcare next year, and 40% offering a virtual primary care physician network or service.

WHAT’S THE IMPACT

Health care affordability is a top concern for many workers, in particular low-wage earners or those coping with a chronic medical condition. While high-deductible health plans have grown over the past decade, employers have recognized that these plans aren’t a good fit for some employees.

More than two-fifths of large employers (41%) surveyed currently provide a medical plan option with a low deductible or even no deductible, such as a copay-based plan, in 2023. And an additional 11% are considering it. Plus, 11% offer free employee-only coverage (i.e., no paycheck deductions) for at least one medical plan option, and another 11% are considering it.

Many employers are looking to address benefit gaps and health disparities for LGBTQ+ and under-represented workers. When it comes to closing gaps for racial and ethnic groups, the two most common initiatives currently in place are advanced search functions to help plan members find acceptable healthcare providers, and multilingual communications (each offered by a third of respondents). 

Specialized behavioral healthcare is provided by 27% of survey respondents, with another 29% planning or considering adding this type of support. Respondents also expressed strong interest in enhancing coverage for maternal care to improve birth outcomes for Black mothers and babies; while 11% currently provide this type of coverage, another 20% are planning or considering it.

Meanwhile, a third of large employers surveyed will offer benefits such as access to fertility treatment coverage and adoption and surrogacy benefits by 2023, and almost another third are considering it. Gaps remain, however: People with disabilities can sometimes be overlooked, and only about half of respondents cover hearing aids and cochlear implants (49%), and cover body support devices and prostheses (48%).

THE LARGER TREND: REPRODUCTIVE HEALTH

The survey also showed rapid growth in offerings on a wide range of family-friendly benefits, with 70% of surveyed employers currently offering or planning to offer paid parental leave in 2023, and 53% providing or planning to provide paid adoption leave. And nearly one in 10 large employers (those with more than 5,000 employees) say they provide on-site child care now or will by 2023, and 22% will provide access to back-up childcare services.

Across U.S. employers of all sizes, 37% of survey respondents provide at least one specialized benefit or resource to support reproductive health, which could include benefits to support high-risk pregnancies, lactation, pre-conception family planning, pregnancy loss or menopause.

ON THE RECORD

“Employers are grappling with finding a delicate balance between what they need to do for talent attraction and retention in tight labor markets versus the challenges of the current economic environment,” said Tracy Watts, senior partner and national leader for U.S. health policy, Mercer. “Employers need to be really thoughtful and specific about their benefits enhancements to ensure they will get a return on their investment. This requires an understanding of the values and needs of their unique workforce.”
 

Twitter: @JELagasse
Email the writer: [email protected]



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