90% of businesses admit to having difficulty filling open positions, but those willing to move to a forward-thinking benefits program struggle less to find new employees, and have more success keeping existing workers. HealthEquity conducted a study in 2021, and found that employers who increased benefits had more satisfied employees (which is important in such a challenging labor market).
What do you need to know to effectively entice and keep staff? Read on to learn what 2022 is expected to bring concerning employee benefits.
1. A top priority will be employee health, and businesses will likely offer HSA meant specifically for wellness pursuits.
During the pandemic, making the wellness and health of employees paramount is of obvious importance. In 2022, 56% of organizations are expected to raise their spending when it comes to mental health and physical support for their employees (claims International SOS’s Risk Outlook 2022).
Since 77% of workers reported to HealthEquity that a Health Savings Account provided peace of mind during the height of COVID-19, it’s no surprise that many employers plan to offer HSA incentive contributions for activities related to wellness. When employees have the option of a Health Savings Account, they often feel motivated to develop their wellbeing, and companies can support this through encouraging exercise and self-care.
2. Supporting mental health programs will continue.
To combat the extreme stress levels almost half of employees reported during 2021’s Mercer Health on Demand report, numerous organizations have adjusted their benefits program.
EAPs, or employee assistance programs, have been vital in connecting workers to resources that help deal with anxiety, depression, legal issues, and alcohol or substance abuse. Whether offered through health insurance plan providers or independent vendors, programs that address these issues have become more popular since COVID-19 started. Employees value the opportunity to avail themselves of such support – evidenced by 48% regarding mental health benefits from their employers highly or extremely valuable, and 42% responding that they would be more likely to remain in their current employment due to mental health benefits (according to 2021’s Employer Health Benefits survey conducted by The Kaiser Family Foundation).
3. Out-of-pocket costs will increase.
Out-of-pocket costs for employees will rise, and to combat this, they will rely more on HSAs, with shopping around and comparisons becoming more common as well. For example, the price of over-the-counter (OTC) medications – a newly-qualified HSA item – can vary widely, when considering generic versus name-brand and mass merchandisers versus convenience markets. More time and attention will be paid by workers so they can pay out of their wallets the least amount possible for options that will still do the job.
In 2022, the healthcare industry is seeing an increase in demand for its services, and at the same time, insurance plan deductibles are rising. This brings out-of-pocket costs up too, and through 2026, they are expected to grow by almost 10% per year (which averages out to $40-50 yearly).
Over-the-counter medications won’t be the only commodity employees will be shopping around for – healthcare is also on that list. A HealthEquity survey has shown that 58% of those looking for a health insurance option currently engage in price comparisons before making a final decision, and tools that provide price transparency between choices have become much more popular over the past few years.
Since being introduced via a federal law in December 2003, HSAs have been used to set aside and later spend money earned on healthcare without the tax burden, and in 2022, employees are going to utilize them to the maximum. The 2020 CARES Act increased their value to consumers, by adding menstruation necessities and eliminating the need for a doctor’s note in order for OTC meds to be eligible for HSA benefits. For many employees, being able to buy these 2 categories of products can mean quite a savings, since HSA funds are tax-advantaged.
4. Employees will likely increase their contribution of HSA funds.
Due to the increase in out-of-pocket healthcare costs and the relatively new HSA inclusions, workers are expected to continue the trend set by 37% of employees which started during the COVID-19 pandemic – funneling more income than ever before into their Health Savings Accounts. More valued than ever before, HSAs are going to become more sought after and made the most of in 2022.
5. Remote work is here to stay, and that means employers will have to consider long-term adaptations.
While remote working arrangements existed long before the COVID-19 pandemic, they became a necessity in some professions and organizations so conducting business could continue during lockdowns and the uncertain times we all endured. Seeing how productivity and efficiency were able to continue during the change in environments, many companies have chosen to allow working virtually even after health restrictions were lifted. With this change came a need for improved communication throughout organizations and flexibility in benefits (including non-traditional ones). Nearly 45% of employees, whether full-time or part-time, are now working from home, and their employers have incorporated flex-time into the corporate culture more than ever before.
There is a new reality when it comes to work, and businesses must realize this to be successful in 2022 and beyond. For example, many health insurances have local networks, but since some employees have the ability to work just about anywhere, they may be better served by a national network instead. In situations where staff work both on-site and remotely, benefits for commuters may need some review, and incorporating more choices in how and when benefits are used may be wise. Mental health, as well as balancing work and home life, have both become more important to workers in the past couple of years, and benefits like education assistance, childcare, and pet insurance – considered non-traditional for a long time – will be more sought after this year and in the future. Frequent virtual meetings to address questions and concerns and regularly updated online resources with benefits offerings information are needed to keep up with not only these changes, but also because employees need access to this information and are not necessarily in the company’s office from 9am to 5pm daily.
These 5 predictions may seem intimidating, but they will also bring positive advancements and solve issues that your workers may have been struggling with for years but only came to light due to conditions and restrictions during the height of the COVID-19 pandemic.
Finding employees is more difficult now than it has been, but adjusting and modernizing benefits will give your organization an advantage in finding the best for your business. An excellent example of this is Pay on Demand, which allows your employees to get paid for hours worked as soon as they clock out, with no cost to your workers and no up-front capital from you. Contact us to learn how you can provide this innovative benefit to your staff!