by srodriguez2020 Benefit Trends Report: Stay Prepared for the Unexpected
This year’s Benefit Trends Report from Empyrean offers key insights into the structure of employee benefit programs moving into the coronavirus pandemic, as well as indications of how benefits may evolve in a post-COVID-19 world.
Today, Human Resource professionals are facing the most challenging moments of their careers, juggling the unique impacts of the pandemic on their employees, businesses, and families. Like nearly every aspect of daily life in 2020, the business of employee benefits has been monumentally impacted by the novel coronavirus, COVID-19. Health and wealth benefits are critical factors in determining an employees’ overall wellbeing, and especially so during this unprecedented period.
There is no doubt that the emergence of COVID-19 will have a profound and lasting impact on the care and coverage of employees moving forward. One key theme that has resonated throughout all of this change has been the need to prepare for the unexpected.
While the data highlighted in this year’s Benefit Trends Report was collected prior to the global emergence of COVID-19, the insights offered in this new report offer an important look at employers’ benefit programs prior to the pandemic – as well as critical insights into how COVID-19 will impact benefits moving forward.
Below is a preview of just a few of this year’s findings. For more, click here to download your copy of the 2020 Benefit Trends Report from Empyrean.
- Preferred Provider Organizations (PPOs) and High Deductible Health Plans (HDHPs) remain the most popular medical plans: 95% of employers surveyed offer at least one of these two types of plans, and 64% of employers offer both an HDHP and PPO. This year’s data has signaled that the popularity of these plans has stabilized among employers.
- Of the 76% of employers that offer HDHPs, only 8% of employers utilize a full-replacement (HDHP-only) strategy, a figure that has remained the same over the past year. While some employers have made the move to HDHP-only benefits packages, most organizations have appeared hesitant to make a similar strategic leap.
- The manufacturing industry remains a leading adopter of the full-replacement strategy. This year’s data also highlights the popularity of HDHP-only offerings among companies in the energy/utilities sector.
Analysis: Is Full-Replacement the Benefits Strategy of the Future?
While 76% of employers currently offer an HDHP as part of their health benefits packages, only 8% of those employers utilize a full-replacement strategy – where HDHPs are the only health plan option offered to employees.
Full replacement strategies are especially common among employers in industries hit hardest by the COVID-19 pandemic – including the manufacturing/industrial and services industries. Given the financial impacts seen across nearly all industries, however, full-replacement strategies may become even more prevalent as employers try to balance employees’ health insurance needs with managing lost business.
As a result of the unique situation surrounding COVID-19, many employers and plan providers have opened up special enrollment periods to those employees that waived health care coverage during their prior Annual Enrollment.
Some employers have offered limited plan choices during these special enrollment periods, including employers that have only offered HDHP plans to participants. This may be a possible indicator for increased interest in the full-replacement strategy among employers in the future.
Prior to the pandemic, low unemployment and high competition over top talent made enacting a full-replacement strategy a potentially controversial move – especially among employees who were accustomed to more traditional plan choices like preferred provider organizations (PPOs) and health maintenance organizations (HMOs). Now employers may be more focused on keeping their businesses afloat. As a result, cost-sharing plans and full-replacement strategies could see more momentum as the lasting impacts of the COVID-19 pandemic continue to surface.
- Nearly two-fifths of organizations now have decision support tools available to their employees.
- The recommendation engine has increased in availability by 38% since last year, and is now utilized at 89% of eligible employers surveyed – making this the most popular decision support tool today.
- More than three-fourths of employers offer voluntary benefits, including accident and critical illness coverage, legal insurance, and pet insurance.
- Wellness programs are increasing in popularity: Half of all employers surveyed now offering a wellness program as part of their benefits packages. Nearly three-fourths of these employers include biometric screenings and other health assessments as part of their wellness program strategy. 81% offer an associated incentive to encourage continued wellness program participation, such as financial rewards or reduced medical premiums.
This year’s report highlights that commitment, dedication, and flexibility are more important now than ever. Ensuring employees have access to the right benefits, guidance, and services is crucial to keeping families safe throughout the current crisis.
Likewise, employers must be able to rely on their benefit administration partners and technology providers to tackle a growing number of process changes, compliance updates, and other evolving needs.
For more data and insights, download your copy of the 2020 Empyrean Benefit Trends Report today. As you read, we’d love to hear your thoughts, questions, and comments. Feel free to contact us anytime at info@goempyrean.com.