Reasons to consider redesigning your benefit programs
COVID-19 has brought many challenges to employers across the country, one of the most significant being an increase in costs. And those costs are expected to continue growing. Research by PWC suggests virus-related employer costs could increase by as much as 10% in 2021 due to a variety of factors, including an increase in mental health utilization and the high cost of specialty drugs and treatments for COVID-19. Employers are also experiencing increased costs from employee testing, purchasing personal protective equipment, installing safety barriers, and bringing in specialty cleaning crews to sanitize offices and buildings after hours.
As employers strive to find ways to reduce costs, they may overlook one of the best opportunities: Redesigning their benefits programs. Following are four key steps benefits managers can take to mitigate the impact of the pandemic now and going forward.
1. Move to virtual enrollment is a great reason to consider redesigning your benefit programs
A recent Harris Poll found that the majority of employees prefer to receive their benefits information electronically. Yet, when enrollment time comes around, many companies still produce stacks of papers, over-sized folders, and a myriad of forms. Moving to a paperless enrollment process can ease the burden for both you and your employees while shortening the entire process. Enrollment webinars can take the place of in-person meetings, which allows you to include a larger number of employees at one time while reassigning staff to more strategic initiatives. Streamlining and simplifying the enrollment process can help improve employee morale and satisfaction.
2. Increase promotion of your Employee Assistance Programs (EAP)
While greater utilization of your EAP can increase costs, it can also help mitigate the mental health impact of social distancing and work-from-home requirements on your employees and your bottom line. The CDC reports that the pandemic in general has increased fear, anxiety, and stress on most workers. And research shows that mental health and substance abuse can cost employers up to $100 billion a year due in part to increased absences, lack of engagement, and reduced productivity. It is important to ensure your employees know the signs of mental health problems and are aware of the EAP resources available to help them and their family members.
3. Renew your focus on improving employee health
The majority of hospitalizations and fatalities from COVID-19 involve those with underlying comorbidities such as hypertension, diabetes, cardiovascular disease, and chronic lung disease—regardless of their age. Obesity, too, is a major risk factor for hospitalization, ICU admissions, and death. These diseases can increase an employer’s average annual cost per member (not including medical spend) from $3,400 for a healthy employee to $20,000 for an employee living with multiple chronic conditions. Since many health experts believe we could experience outbreaks of COVID-19 over the next three years, employers need to do all they can now to reduce chronic diseases in their employee populations.
4. Implement a proven employee-centric disease-prevention program
Traditional disease-prevention programs for obesity, pre-diabetes, or hypertension are designed around a curriculum, not the person and his or her unique health needs. This is likely the reason so many of these programs fail to achieve optimal results that last. Instead, employers should opt for a one-size-fits-one approach where the program is designed specifically for the person. This can be accomplished through things like genetic testing, social determinants of health, and psychosocial assessments. Using this information, participants can be matched with a like-minded coach trained in exercise, nutrition, and behavior science. Coaches meet participants where they are and guide and motivate them to achieve lasting results.
In 2015, Newtopia teamed up with Aetna to implement such a plan for Aetna employees who were identified as being at greater risk for developing lifestyle-related chronic disease. Results were significant. Not only did participants lose an average of 4.3% of their body weight, but 50% chose to continue beyond the initial year-long program. In just one year, Aetna saw a $1,464 saving in healthcare costs per participant. Year-two results were even greater, far out performing typical prevention programs. Click here to learn more about results. Since then, Newtopia has replicated and improved upon these leading outcomes across multiple industries.
The time to act is now
Implementing a change in your benefits program during a pandemic takes courage, but doing so can bring significant cost savings to your company in a time when margins are spread thin. And helping your employees reduce the risk of chronic diseases brings significant benefit to them and their families as well. It’s a win-win scenario that companies would be wise to embrace—both now and after the pandemic.
If you’re curious about how Newtopia can contribute to your discussion about redesigning your benefit programs (and achieve 2x ROI in Year 1), email email@example.com.