How US employers can prepare for rising employee healthcare costs.

The announcement from the National Business Group on Health that employee healthcare costs could increase by 6% in the new year is yet another sobering reality of the ever rising cost of healthcare.

What’s causing the healthcare cost increase?

According to CNBC the hike is mainly the result of specialty pharmacy costs, expensive claimants and medical inflation in general. These factors aren’t anything new, though.  So what gives? The trouble is employers are running out of ways to cope. Organizations now rely heavily on premiums, co-pays, co-insurance, deductibles, and cost sharing to shift the burden from employer to employee, but this solution is not sustainable.

Employee contributions are a Band-Aid solution.

Employers can’t expect their staff to cover higher and higher costs forever. Expensive health care has already forced many American workers to limit the services they access, even when in dire need. For instance the 4th Annual Guardian Workplace Benefits Study found that 33% of surveyed employees with high-deductible health plans responded that they “ignored medical advice or neglected their own care.” Twenty percent of that group said they skipped a doctor’s appointment, while 14% postponed a surgery or recommended procedure.

If anyone thinks this is a good way to save money, they are gravely mistaken. An employee who delays receiving medical treatment runs the risk of their symptoms worsening, which could result in a condition that is both more difficult and costly to address than if they had sought medical attention earlier.  By deferring care, the employee is also more likely to take more sick days and be less productive at work.

Your organization can be preemptive.

Don’t wait until it’s too  late to help your staff live healthier lives. Creating a culture of well-being goes a long way to improving your employees’ short- and long-term health outcomes. Not sure where to start? Here are some ideas:

  • Actively promote health and wellness in all aspects of the workplace, from ergonomic furniture and natural lighting to flexible hours and team activities.
  • In addition to physical health, prioritize your employees’ mental and emotional well-being.
  • Foster an open and judgement-free environment in which employees feel comfortable discussing wellness and asking for help.
  • Ask your employees what they need to reduce their stress and fatigue, then implement their suggestions.
  • Keep your staff continually motivated through relevant incentives.
  • Make wellness resources widely available—and enthusiastically encourage staff to access them.
  • Regularly check in on your staff to ensure your wellness plan is actually effective, and make immediate adjustments where necessary.

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Also published on Medium.