Reading the latest survey of health care benefits is like twisting Rubik's cube. How is this going to work?
One survey says: Employees value their employer-sponsored health benefits highly.
Another says: Large employers — committed to providing health insurance for the foreseeable future — intend to make coverage affordable through aggressive interventions to improve their workers' health.
And the third: Workers do not trust employers' advice when it comes to health matters.
Is there an opportunity in here for health insurers?
First, the happy news. Even though employees like to complain about their health benefits, those complaints appear to be a case of kicking the one that is loved. Workers at large companies so value their employer-sponsored health coverage that they would accept lower salary raises or reduced retirement contributions more easily than a reduced health benefit (See "Employees Happy With Their Benefits" below.)
Large employers understand that. Yes, the trend of small companies getting out of the health insurance market and the decline of employer-sponsored coverage is well documented, but America's biggest companies do not intend to follow suit.
A survey of 450 employers — with an average of nearly 19,000 employees each — conducted by Hewitt Associates, the human resources consulting company, found that none of the respondents believe their organization will be less involved in health care benefits in the next three to five years than it is today.
"No one was on the exit ramp," says Jeff Munn, who leads the design and development team for Hewitt's health management practice. "We were pleasantly surprised."
Rather than run from the ever-escalating health care costs, the large employers, who together provide coverage for more than 8 million workers, plan to embrace the cost challenge head-on.
"We were very encouraged to find that not only are large employers not dropping out of health care, they are getting more involved than ever and are actually committed to helping individuals improve their own health," Munn says.
Nearly two-thirds of employers said they intend to take aggressive, multiyear steps to improve employee health. Top strategies:
- Analyze claims to determine the chronic conditions prevalent in the workforce (87 percent are now using that strategy or will roll it out this year),
- Deliver targeted condition-management programs through health plans (79%), and
- Focus wellness programs on reducing health risks (65%).
Employers also report that they are ready to get much more direct in improving employee health habits.
Nearly half of the employers now offer or will offer incentives for employees who participate in wellness or other health-related initiatives by the end of this year. Meanwhile, about 25 percent will offer incentives for people at risk who participate in condition-management programs and comply with recommended therapies by the end of 2007 — and a large majority of respondents said that they are considering both those tactics for the future.
While employers are pulling out megaphones and whistles, their workers are not likely to leave the locker room if the company is the coach.
J.D. Power & Associates asked more than 10,000 consumers to identify whom they trust the most for advice on staying healthy and getting the best health care. Few of those respondents identified employers as a trusted choice.
"We were surprised to see how low that was, but I wasn't surprised to see that in general, employers would not be high on the list," says David Stefan, executive director of J.D. Power's health care practice.
Role of health plan
After all, even though employers may altruistically want their employees to have good health, these helpful programs only emerged when the financial burden of their poor health became unbearable.
"Employees can sometimes be a little concerned or suspicious about some of the motives that employers may have regarding health," Stefan says. "I don't think consumers are ready yet to accept the employer role as an arbiter of health."
While health plans did not score high on the "most trusted" responses (see table), they fared much better than employers. That might suggest health plans should assume a bigger role in health promotion.
"I don't think this issue of trust means employers should stop trying," Stefan says.
"It may involve doing more in partnership with the health plan, or it may evolve like 401(k) plans in which employers don't even really try to communicate about how we should handle them. The information and all the rest gets outsourced."