People seek several things from their workplace. Although job security and diversity are important, these factors don’t come close to a higher income and increased benefits. According to a Gallup poll, 64 percent of people surveyed said a significant increase in benefits or income was a primary motivator for accepting a new job offer, and 61 percent said better personal well-being was a very important factor.
However, providing the robust benefits employees desire can be difficult for companies due to rising healthcare costs. Let’s explore how employers can get over this hurdle and improve retention.
The Impact of Rising Healthcare Costs on Employee Retention
Employer healthcare costs are forecasted to increase by 8.5 percent in 2024 due to high medical cost inflation. Additionally, outpatient prescription drug costs are expected to increase by 10 percent.
In previous years, employers have avoided increasing costs to employees to keep their healthcare more affordable and help with recruitment and retention. However, as inflation catches up to medical costs, there may be less room to avoid shifting costs to employees, which can have a dramatic impact on turnover.
Employee turnover impacts much more than recruiting expenses. When an employee leaves a company, it can cost between one-half to two times their annual salary, according to Gallup. This is because losing an employee includes costs such as advertising the now-vacant position, onboarding the new employee, and losing productivity for the entire time the role remains open.
Considering that turnover rates range from 11.8 percent to 60.5 percent, depending on the industry, and employees are choosier than ever when deciding on a job, it’s clear that the cost of employee turnover can get out of hand.
To reduce turnover, many employers emphasize high-deductible health plans to mitigate rising costs. The problem is that high-deductible health plans may not work for some employees, particularly low-paid employees and those with health concerns.
Employers may feel they only have two options: Avoid increasing healthcare costs for employees and absorb the costs themselves, or face recruitment and retention problems. However, there are other solutions.
How to Overcome the Hurdle of High Healthcare Costs
Optimizing employee benefit packages by offering price transparency and healthcare navigation tools can help address recruitment and retention issues while providing meaningful benefits. When you optimize your employee benefits, prospective employees will see that your organization has determined what employees desire and taken steps to provide those benefits and make them more affordable.
Consider what your employees value.
First, understand what your employees value. This will help guide your decisions surrounding benefits and how they can help your employees. It will also help you pare down the benefits your employees don’t find meaningful.
Offer price transparency tools.
Healthcare is getting more expensive for both employers and employees. By offering easy-to-use price and quality transparency tools to employees, you can help ensure your employees receive the care they need while saving them (and your company) money.
Price and quality transparency tools such as Bluebook CareConnect™ can help employees make informed decisions regarding common medical procedures by providing personalized assistance from a member concierge who helps them find high-quality care at a Fair PriceTM.
CareConnect pairs well with Bluebook Rx™, which optimizes an employer's formulary and guides members to lower-cost medications to ensure higher satisfaction.
Drive behaviors with engagement rewards.
When people are engaged with their healthcare decisions and empowered to use a comprehensive suite of healthcare tools, they’re more motivated to make healthy decisions based on quality and cost.
Engagement rewards are powerful motivators when it comes to healthcare. They encourage employees to take advantage of their healthcare benefits while rewarding them for choosing high-value care in various ways, from wellness points to health savings account (HSA) contributions.
Learn How to Choose Healthcare Navigation Tools for Your Organization
Healthcare navigation tools are essential to lowering healthcare costs for your employees and organization, but no two solutions are the same. Find out how to choose a solution that works for your organization and build a robust benefits plan with our guide, How to Choose a Healthcare Navigation Solution That's Right for Your Organization.