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Employers are wise to routinely seek the right combination of employee benefits to attract, engage, and retain top talent—all while staying within budget. Although outside forces may try to influence these decisions, the best way to create a winning benefits package is to engage directly with employees.

The Lively 2024 Employee Benefits Market Check reports that “81% of organizations have improved benefits to attract and retain employees in the last 12 months.” And according to the Forbes Advisor 2024 Ultimate Guide to Employee Benefits, an essential best practice for updating or designing an attractive benefits package is to offer benefits that “meet the needs of your employees” that they will “actually use and appreciate.”

Enhanced benefits reflect the needs and personality of each organization and can range from pet insurance, gym memberships, and free coffee and snacks at the office to tuition assistance, financial wellness programs, and expanded leaves of absence. But across the board, offering an affordable and comprehensive health plan is a primary driver of employee satisfaction.

Health Benefits Still Top the List

According to Forbes, the top three employee benefits are healthcare, PTO and a retirement savings plan. This aligns with findings in the Lively report, which prioritizes healthcare coverage after improving salaries and bonuses.

Forbes emphasizes the need to “communicate the details of your employee benefits package to your employees. They should know what benefits are available to them and how to take advantage of them.” Employers should seek health plan providers who offer personalized, concierge support that educates and guides members through the complex healthcare landscape.

Forbes also encourages affordability for both employers and covered members. Employers are cautioned against offering expensive benefits that “can strain your budget and make it difficult to offer other perks or salary increases.”

Companies can counter the drumbeat of constantly rising spending for their legacy insurance plans by reducing medical and Rx claims cost with a modern health plan. This makes it affordable to offer employees better coverage at a lower cost or to free up dollars for salary and bonus improvements.

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Consumers are spending hundreds of dollars on self-administered tests that claim to quantify their cellular health and biological age. While doctors are cautious about the value of such tests, it’s important to acknowledge the underlying desire to improve one’s health based on the results.

The emerging field of epigenetics defines biological age as the accumulation of damage that can be measured in the body. In a New York Times article, Jesse Poganik, a Harvard Medical School instructor who researches biological aging, explains that:

“(Biological) changes happen naturally as we get older; they can also be sped up by behaviors that affect health, like smoking and excessive alcohol consumption. As a result, estimates of biological age have been shown to be associated with things like life expectancy and health.”

Despite the claims of many anti-aging interventions, “scientists don’t know how to reverse someone’s biological age — or whether that’s even possible.” That hasn’t stopped some creative people from trying to change their legal age based on their supposed biological age.

Experts caution that biological age tests don’t actually reveal much about one’s health and that their results can be unreliable. But they do measure factors that can be modified through medication and lifestyle changes.

Most reliable are conventional blood tests that measure cholesterol or hemoglobin A1C and can be used as a proxy for measuring a person’s biological age. In fact, Poganik encourages “expanding access and using more frequent testing to optimize health.”

Employers can reduce employee health risks and comorbidity complications with an affordable, member-focused Vitori health plan that encourages preventive and primary care and simplifies access to testing. And by removing financial barriers with low (and no) out-of-pocket member costs, employers can help combat the financial stress that contributes to biological aging.

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Everyone struggles with finances occasionally, but those with medical debt bear a heavier burden than most. KFF, an independent source for health policy research, reports that “People with medical debt are much more likely than those without such debt to show other signs of financial vulnerability.”

This often takes the form of carrying high credit card balances and having no extra cash on hand to meet unexpected expenses.

The financial worries from “just getting by” create considerable stress and potential mental health issues that can impact both personal and professional responsibilities. To meet current financial obligations, the study found that those with medical debt are more likely to seek short-term funds from costly sources such as payday loans and pawn shops. Individuals also risk future insolvency by withdrawing needed funds from retirement accounts.

Delaying Treatment: Strategy or Tragedy?

Many individuals attempt to stabilize medical expenses by delaying or forgoing needed care, sometimes with life-threatening implications.

Yet another study reveals that:

“Forty percent of Americans admit they have delayed care due to costs, while one in six say their work has suffered due to a health issue they couldn’t afford to address.“

Impact on Job Performance

There is a clear connection between an employee’s mental health and their job performance. Although this finding reflects the perspectives of younger employees, it no doubt applies to all generations experiencing financial insecurity:

“More than 30% of Gen Z and millennials say their personal financial worries have been a distraction at work. More financial education can help workers address their financial challenges, reduce stress and improve focus and productivity.”

Employers can reduce medical financial stressors that negatively affect job and business performance and improve employee satisfaction and retention. By passing along the significant savings that a modern health plan can deliver, plan sponsors can provide better benefits and lower out-of-pocket costs for employees and their families. This includes low or no-cost plan features including surgeries, prescription drugs, and mental health telemedicine.

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Americans have long struggled with a dysfunctional healthcare industry and legacy insurance plans that cost too much and don’t deliver. Instead of focusing on what’s wrong with the status quo, a recent study asked employees to prioritize what future health plans should offer.

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Employers can (and should) align with the survey results when choosing an employee health plan by prioritizing:

• Lower Costs
  Reducing insurance premiums, co-pays, and deductibles is a clear baseline. Equally important is for employers to provide built-in access to employee financial assistance and no-cost options for prescription drugs, common surgical procedures, and mental health care.
  
• Expanded Services
  Remote telehealth services became essential during the pandemic. They have since been embraced by both patients and providers as a convenient and effective way to deliver high quality medical and therapeutic care. Every employee health plan should include them, ideally at no cost to the employee.
  
• Less Complexity
  Who doesn’t need help navigating complex medical systems and bureaucratic digital paper trails? Employees deserve robust online tools and a dedicated support team to get the most from their health plan. This is especially important for Gen Z and other younger employees.

It’s no secret that robust health benefits, retirement plans, and other perks help attract and retain a talented and dedicated workforce. Conversely, the survey reveals that 1 in 6 respondents “dislike their job but stay for health benefits.” The corollary to this is that employees will leave for less costly, better health benefits. This means that employers should be proactive in prioritizing what current and potential employees want most in a health plan.

Employers and benefits advisors who really want to make a difference can choose a compassionate, member-focused health plan that saves up to 30% in health care costs, enhances benefits, and delivers an exceptional member experience.

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A comprehensive JAMA study analyzing 32 years of data suggests that health premiums for employer-sponsored health benefits have been rising faster than wages. These costs are often passed on to employees, further reducing or stagnating wages and increasing income disparities by race, ethnicity, and wage level.

According to JAMA, “Since the 1980s, real wages have increased among the highest earners but have been flat for most workers, leading to a widening earnings inequality. During the same period, the costs of employer-paid health care benefits have also increased substantially. As health economists demonstrate, it is generally accepted that increasing health care premiums result in lower wages for employees.”

Additionally, health care premiums as a percentage of compensation were significantly higher for Asian, Black, and Hispanic families than for White families.

The study also notes that “most employers do not adjust the health care premiums charged to workers by employee earnings; thus, the displacement of wages owing to increasing health care premiums could be particularly problematic for lower-wage workers and could be associated with earnings inequality.”

Improve Real Wages and Equity by Halting Healthcare Overspending

Instead of perpetuating this damaging dynamic, forward-thinking employers have the power to fix the healthcare cost drain on their employees’ wages. With a modern health plan that reduces overspending by 30% while improving member support, Vitori employers can use these substantial savings to lower health plan premiums and implement more equitable wage-banded premiums. They can also fund competitive benefit and business enhancements to attract and retain talent.