Recognizing the high cost of health care and in a bid to help workers keep more of their hard-earned money, a larger percentage of companies are paying more for staff members' employee benefits, a new study confirms.
In 2015, a majority of businesses that offered employee benefits to personnel increased the company half of contributions to the cost of coverage, more so than during 2014 or 2013, based on recent analysis conducted by the Transamerica Center for Health Studies.
Companies that put more business earnings to the cost of coverage intend to keep the conditions the same this year. More specifically, the poll found that 57 percent of employers will pay the same rate they did last year for premiums, based on the TCHS poll. Approximately 60 percent indicated they'd do the same for deductibles and 58 percent for co-pays. What's more, nearly one-third of employers said they'll contribute a larger amount.
Hector De La Torre, TCHS executive director, noted that while the cost of health care is greater today than it has been in years gone by, the quality is improving as well.
"The anticipated increase in health care costs correlates to improved quality for many employers," De La Torre explained. "Two in five companies anticipate the quality of health insurance they offer employees will improve in the next 12 to 36 months and only 10 percent expect the quality to decline."
Two-thirds highly concerned about prescription drug expenses
He went on to say that there are certain types of employee benefits that businesses are more concerned about than others in terms of cost overruns. For example, 7 in 10 companies expressed anxiety about the ability to manage cancer-related medical expenses, 69 percent for prescription drugs and 68 percent for diabetes-related treatment. Just over two-thirds were also concerned about health care costs stemming from obesity.
Though many businesses are trying to shield their workers from excess health care costs, individuals themselves are feeling the effects regardless. Almost three-quarters of Americans who at least pay some of their health insurance premiums are paying more today than they were last year, according to a survey conducted by Gallup. In 2014, over two-thirds indicated they were spending more on health premiums. Only 6 percent said they were paying less and only 4 percent said the same in 2015.
Workplace wellness programs can cut reduce cost of health care
Employers recognize that one of the best ways to reduce the cost of health care is to not needed it as much, a goal they're trying to realize through workplace wellness programs. Many are finding success. Over 61 percent of employers offered workplace wellness activities for workers in the last 12 months, TCHS reported from its poll. Of these, close to 50 percent said lowering the cost of health care was the primary justification.
De La Torre said that while employee benefits and wellness programs are an added cost for businesses, most companies view it as an investment that's well worth it in the long run.
"Providing the best healthcare benefits package possible remains the top health care-related priority for employers," De La Torre said. "Interestingly, employers that offer health care benefits are more likely than those that do not to anticipate profitability, hiring and wage increases in the next two years."
Over the last two years, employers have added 200,000 jobs to the nation's economy per month, according to government data. In 2016, nearly 40 percent of businesses intend to increase the rate of hiring, on par with how 2015, according to a poll done by CareerBuilder earlier this year.
