Rising health care costs and greater employee benefits responsibilities continue to be a steady concern as the health care landscape evolves. The new health care trends and changes bring new worries for employees and employers alike.
As a small business owner, you are faced with HR issues, such as greater employee benefits responsibility in the face of increasing health care expenses, and must learn what topics are most important to communicate back to your workforce.
Health Care Trends 2014: Keep Your Eye On These
Below, we’ve simplified a few key trends to watch as Q2 2014 really gets under way:
1. Increased Focus on Accountability to Control Health Care Costs
With health care costs continuing to soar and no end in sight, consumer and provider accountability are gaining attention as potential solutions to controlling rising health care costs. Although the road ahead is long, companies are already taking steps toward solutions. The continued development of accountability strategies could mean more predictable and controlled costs for employers and employees may truly begin to see lower or no-cost health care services. The onus is on both parties to see through these aspirations.
On the consumer side, three of four (79 percent) employees would be willing to change their lifestyle habits if their employer rewarded them with lower premiums. An example of this type of program would be employees who do not use tobacco having lower insurance rates than their smoking counterparts.
When it comes to provider accountability, hospitals and insurers are working together to move their pricing models to value-based outcomes and companies are beginning to make strides with bundled pricing to keep costs under control.
2. Emergence of Private Insurance Exchanges
Privately run exchanges are steadily gaining momentum and offer a one-stop shop for buying employer-provided health insurance. These exchanges present employers with a simpler way to offer comprehensive worksite benefits.
With private exchanges, small businesses can designate an amount to pay for coverage and employees can compare insurance plans and purchase one that is right for them. This type of delivery model helps employers control costs by giving employees a fixed stipend toward benefits. Once employees choose their benefits, remaining costs are paid by the employee through their paychecks.
3. A Growing Need for a Strong Consumer Safety Net
In 2014, rising health care costs are expected to take another (PDF) $181 (6.9 percent) out of take-home pay, but only 11 percent of small businesses are planning raises for their employees. Even if employees are covered by a comprehensive major medical plan, out-of-pocket costs – both medical and non-medical – can be substantial if the employee or a family member has a serious injury or illness.
The need is evident: Two in five (43 percent) U.S. workers at least somewhat agree they will have a difficult time managing their own health care coverage and decisions because they already have difficulty saving and sticking to a budget today.
As a small business owner, it’s up to you to use effective employee education and consumer-directed benefits tools to help workers make smarter benefits decisions. Voluntary insurance benefits will continue to be a key way to help employees protect themselves from increasing out-of-pocket costs that could result in unexpected debt.
4. Tailoring the Employee Value Proposition to the Next Generation
Millennials are on their way to being the most educated generation in American history and are undeniably defined by their use and affiliation with technology. The majority (83 percent) say they have placed their cell phone on or right next to their bed while sleeping – compared to 57 percent of the total population (PDF) saying they have done so.
Smart small businesses will adapt to the newest generation. Increased technology use is already taking the stage with 43 percent of employers planning to deploy digital technologies such as Web tools and mobile apps in 2014, and 31 percent are considering these tools for 2015 or 2016.
In the years ahead, employers must continue to take measures to adjust retirement, engagement, training and communications programs to account for a changing and more transient workforce.
Onward and Upward
Needless to say, these are only a few of the trends that will take place as the health care market continues to evolve. However, keeping your eye on these will get you started down the right path for the rest of the year.
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