4 Alternatives to Offering Paid Healthcare Benefits
The cost for companies to provide healthcare benefits is at an all-time high, according to a new Towers Watson report. In 2014, healthcare costs reached an average of $9,560 per employee, and that’s just the employer’s share.
Related: The Real Power of Health Insurance
Though this new law might make healthcare more expensive to employers, Healthcare.gov does provide many affordable options for individual and family plans. For example, if an employer does not offer coverage, the individual may be eligible for a tax credit.
Since the Affordable Healthcare Act is giving consumers more control over their own healthcare, offering healthcare as a benefit might not be as attractive as it once was. In place of providing healthcare as a benefit, consider providing these benefits instead:
1. Pay enough to help cover costs of personal plans
Though healthcare costs are rising for employers, it doesn’t necessarily mean employees will have the same experience with a personal or family plan. Instead of taking out plans for the whole company, give everyone a boost in salary or an annual bonus to help cover the cost of employees’ personal insurance plans.
2. Opportunities to work remotely
We’re entering an age where the workforce is starting to get picky. Why? It’s increasingly being flooded by millennials who grew up alongside the Internet, mobile technology and access to any information on demand from virtually anywhere. Not surprising, but the younger workforce actually cares more about freedom in the workplace than other benefits renowned by Baby Boomers, including healthcare.
A 2013 study by PwC, the University of Southern California, and the London Business School found flexibility in where and how much millennials work has a big impact on job satisfaction. To remedy this, more companies are offering the option for employees to work remotely either part-time or full-time.
A 2013 WorldatWork survey reports that telework is now offered by 88 percent of organizations. One-third of organizations offer telework on a full-time basis. This allows 54 percent of organizations to offer a more flexible schedule to employees.
Instead of healthcare, consider offering employees the option to work from home once a week, or one week per month, depending on the schedule that tasks demand. Employees, especially millennials, will have more freedom that seems more important than health insurance coming from an employer.
3. More flex/vacation time
Instead of offering healthcare to supplement the medical expenses that may be incurred due to workplace stress, treat the source. Play a part in helping reduce workplace stress so employees will be healthier in the first place.
A 2013 study published by the Canadian Center of Science and Education found that offering employees flexible work hours not only reduced stress and absenteeism, but also improved morale and motivation. When employees have the freedom to balance work and home life, overall well-being is improved. A healthy well-being means less frequent illnesses and, therefore, less frequent doctor visits and medications to subdue the harmful effects stress from work has on the body.
4. Creative perks to inspire innovation
By 2025, 75 percent of the workforce will be made up of millennials. Companies are going to have to make a few adjustments to ensure employee retention. Along with offering more freedom and autonomy in the workplace, companies will need to be creative to hold millennial interest. In fact, a Deloitte study reveals 78 percent of millennials are influenced by how innovative a company is when deciding where to work.
To millennials, healthcare now pales in comparison to perks like catered meals, attraction tickets, and even fun workplace environments like the ones offered by Apple, Google and other companies known for innovation.
While it might not be realistic to open a cafe in the office building, try filling the break room with snacks and refreshments. Once a month, organize a catered office lunch. Employers in the service industry can build relationships with entertainment companies such as theme parks and movie theaters to see if service trades are an option.
It’s possible that, in the next 10 years, offering healthcare as a benefit may be irrelevant given the new freedom individuals have with adopting personal healthcare plans. Just as the workforce is changing, companies should adapt and be aware of the benefits that might be more pertinent to employees.