Employer Challenges Persist for Health Benefit Offerings

A survey from financial research and benefits consulting firm LIMRA, “Employee Benefits at a Crossroads,” finds that the competing variables of increasing health care costs, the implementation of the ACA, and the desire to offer a competitive benefits package leave many employers unsure of how to proceed with benefit offerings.

While uncertainty is widespread, employers appear to recognize the importance of offering health care benefits. The survey results show the following trends:

• Nearly 80% of surveyed employers say it is the employer’s responsibility to pay some or all of the premium for their workers’ benefits;
• In terms of plan choice, 57% believe employees want plans with multiple benefit choices and plan features. Thirty-five percent say they believe their employees want limited choices for ease of decisionmaking; and
• To attract new employees, nine out of 10 employers say they must offer medical insurance.

However, the survey results also show that employers have concerns about health care plans in general and with the implementation of the ACA in particular:

• Just over half of surveyed employers expect the ACA to have a negative impact on their ability to offer medical benefits in the near future;
• Eighty-five percent of employers say controlling the costs of health care is an important or critical challenge; and
• Employees need to take more responsibility for their benefits, say 67% of employers surveyed.

Developing sufficient feedback from employees about health care benefits may also be an issue, as nearly half of employers say they conduct employee benefit surveys only “once in a while,” with 15% conducting surveys on a regular basis and 38% saying they never do them. In addition, the survey finds that 8% of employers are not sure how much choice their employees wanted in their benefit packages.

As for communicating with employees about their health care benefits, 44% of those surveyed believe that companies need to use targeted communication strategies for specific employee populations. However, 80% of employers surveyed say they use the same communications strategy for all employees. According to LIMRA, this shortcoming highlights an opportunity for benefit advisers and health care coverage carriers to better serve employers’ needs by helping them to customize their approaches to employee benefits education.

More information about the survey can requested here.