Expert Perspective by Grahall’s OmniMedia Editorial Board
It likely didn’t come as a surprise to anyone that the Kaiser Family Foundation Employer Health Benefits 2010 Survey, according to the article September 2, 2010 article in the New York Times by Reed Abelson (Employers Push Costs for Health on Workers), found that “Workers’ share of the cost of a family [health insurance] policy jumped an average of 14 percent, an increase of about $500 a year. The cost of a policy rose just 3 percent, to an average of $13,770… Since 2005, while wages have increased just 18 percent, workers’ contributions to premiums have jumped 47 percent, almost twice as fast as the rise in the policy’s overall cost.”
Clearly there are forces at play here that have been around for a long, long time. Health care reform is supposed to fix some of those problems. But with little happening before 2014, companies and consumers are left to wonder what reform will mean for the overall health of Americans and that of their wallets.
Companies are in the business of making good and providing services to consumers and customers. They are not in business solely to provide health care to their own employees. During this economic downturn, when companies are looking to cut costs, and employees are desperately hoping to hold onto their jobs, there is little hesitation on the part of companies and little argument from employees about a company’s decision to shift health care costs to employees.
But there are other forces at work as well. The population of the US is aging, and the workforce is graying. The economic downturn did more than put people out of work, it delayed retirement for many.
As we shared in our November 2009 blog The Haves vs. The Have Nots, heath care plans were first thought of as an entitlement, then they morphed to become a component of total remuneration. And that is for the most part how they are viewed today. But in the very near future companies might be wise to change the perspective around these plans again and this time view them as productivity tools.
The fact that companies today employ an older workforce is more by chance than by design, what with the demise of DB pension plans and the transition to 401(k) plans, among other factors, , which has left many baby boomers unable to retire. It will become important for companies to keep this older workforce healthy and productive. As the workforce ages, companies need to build heath care plans that promote wellness, that get and keep employees healthy.
On the bright side, the economy, health care reform and the changes in workforce demographics give employers an excellent opportunity to review total remuneration and make sure that it is properly aligned.
Contact us, we can help you analyze how Health Care Reform will impact your company and how you might adjust your total remuneration package to drive better business results.
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