The workplace has undergone dramatic change over the last two years. During the COVID-19 pandemic, employees embraced the flexibility that remote working affords them. Today’s “workplace without walls” recruits from a national and global talent pool, not just local applicants. At the same time, the pandemic has magnified the spectrum of differences in how people perceive the value of different types of employee benefits.
Against this backdrop, benefits have become an ever-more important lever for employers seeking to attract and retain talent while fulfilling their fiduciary duty to the organization and members. But what new benefit challenges are also emerging in this landscape?
“I think health, pharmacy, and benefits are almost like table stakes now,” says Lisa Vilaverde, Vice President of Total Rewards at the Equinox Group, the health and fitness company. How are HR leaders rethinking the way they purchase and construct benefit programs to attract top talent? When doing so, what are their most pressing business issues and challenges? And what makes a great plan partner for meeting those challenges?
In many respects, the answers for this new world of work lie in some long-proven notions: know your options, use data and insights to understand your population and reduce costs, and make informed decisions about benefit programs.
To shed light on how employers are applying these concepts in today’s environment, Truveris assembled a panel of innovative HR leaders for a virtual roundtable, “HR Leaders’ Perspective: Priorities and Challenges for Employee Benefits in 2022.” Their perspectives on three key themes of the webinar are captured in this blog.
Evolve Benefits Strategies to Control Increasing Costs
Gauging from responses to an audience poll during the webinar, one of employers’ biggest benefit challenges is cost. “Bending the spend” in an enduring way requires looking beyond the lowest-hanging fruit.
Pharmacy, which represented approximately 14% of national health expenditures in 2020, but for some employers can be as much as 30% of overall healthcare benefit spending, provides a substantial opportunity to control costs. For the HR leaders responsible for managing their organization’s benefits spend, it takes ongoing attention and support to find solutions that address increasing costs, while providing as comprehensive coverage to members as possible.
“We look at our claims monthly, but then on a quarterly basis we come to ‘what cost indicators are most important to us?’” said Vilaverde, one of the panelists on the Truveris webinar. Once those metrics are determined, Equinox engages a partner to help monitor utilization and continually verify the intended outcomes of the benefits program. “Are they impacting cost? Are we seeing anything that we thought we would see when we bought that program?” added Vilaverde.
When it comes to benefit packages, employers can find themselves struggling to be all things to all people. Panelist John Fischetti, Vice President of Total Rewards at Kyndryl, a large technology infrastructure provider, said longer-tenured employees tend to want different things compared to newer employees. Longer-term employees in midlife, for instance, may value benefits that address chronic health needs, while younger employees may place more value on a childcare benefit. From this emerges complex benefit challenges.
“You realize you can’t be all things to everyone for a whole host of reasons, not the least of which is just the cost of it. You begin to pivot toward things like lifestyle benefits, giving people dollars to spend in any given year however they choose,” said Fischetti.
Ensure Members Understand How to Get the Most out of a Program
The defined-contribution approach that Fischetti describes speaks to a need for member education and engagement. When proactively asking employees how they might spend a lump sum on benefit plans, Fischetti finds a treasure trove of desires and data.
“You also very quickly learn that there’s a lack of education sometimes around your programs,” he said. “How do employees engage with those programs if they don’t really understand them? So, the answer isn’t always more benefits, more cost. It’s often about ‘how do we educate employees on what they do have access to?’” said Fischetti.
Panelist Amy VanDuyn, Senior Vice President of Human Resources at Phreesia, a healthcare software company, routinely meets with employee resource groups (ERPs), which are employee-led groups that share certain characteristics, to understand which types of benefits are most valuable to them.
For instance, as the pandemic blurred the lines between work-life and home-life, employees expressed a greater need for emotional support. “Mental wellness has become a much bigger conversation,” said VanDuyn. “And so, we have continued to think about that and how we create a wellness program that is inclusive of mental and physical support.”
Build a Trusted Partnership and Leverage Solid Reporting
As benefit packages evolve, it’s important for plan sponsors to understand how well new approaches serve their goals and employees’ needs. That’s where a pharmacy partner that provides transparency and insights can be invaluable.
“I’d say accuracy of claims and speed of claims [are] super important to us,” said Fischetti. “It’s the way in which employees…feel the level of quality they get from us as an organization.”
Making that connection between the data and the individual members using the benefits plan helps drive engagement from employees, but also helps define broader strategies.
“Reporting is huge because it’s what we use to make decisions,” agrees Vilaverde. “Those reports should be action-oriented.” But the utility of those reports is only as good as the working relationship between sponsor and partner.
Equinox creates a 3-year roadmap for goals and shares it with partners. “It’s my responsibility to let them know, ‘here’s what we think the three years are going to look like. How can you support that’?’” says Vilaverde.
In an audience poll, more than half of webinar attendees said they rely on their brokers when making decisions about benefit challenges. Some panelists discussed why a close relationship with their brokers is meaningful to them.
“It’s not just about the data, but about understanding our culture,” said VanDuyn. “We’re not just looking for the cookie cutter options. Where can we be creative? I really look to them as being experts in this field.”
Along those lines, perhaps the most valuable broker partner isn’t one whose actions are always event-driven.
“I think I’ve found the most value in a consultant that picks up the phone and just calls to listen and maybe share an idea,” said Fischetti. “You know, ‘we’re partnering with you and here’s what we’re hearing’ or, ‘hey, is there anything we can do for you?’ From my perspective, that makes a big impression.”’
Interested to learn more? Watch the recording of the full webinar, HR Leaders’ Perspective: Priorities and Challenges for Employee Benefits in 2022.