What’s in the crystal ball for HR professionals in 2015? The new year will have its share of surprises, but industry experts have identified several areas that will get a lot of attention from HR departments.
First off, insurance changes associated with the Patient Protections and Affordable Care Act will continue to bear close watching. This includes the employer mandate, which goes into effect in 2015 for companies with 100 or more employees. Although many employers have successfully navigated the PPACA changes so far, the future of the program still is clouded in uncertainty, with another Supreme Court case threatening to undermine major parts of the health reform law.
The high deductible health plan model has many benefits, but employers are still challenged to find the right balance when shifting more cost to employees. Still, many see the rise of HDHPs as inevitable.
Also in the health care realm, wellness efforts continue to be an important tool for employers, helping them to hold down health care costs and provide programs that are highly valued by many employees. Many employers are integrating personal technology and social networking into wellness program, with good success. Expect this trend to continue to grow in 2015.
In the recruitment/retention arena, some expert are predicting significant new pressure to replace aging baby boomers who are dropping out of the workforce at an increasing pace.
Finally, the term “workplace” is itself becoming more ambiguous, as workers telecommute from home or turn to flex-time arrangements in order to pursue a better work-life balance.
Read on to explore the major trends for HR in 2015.
Employer mandate: Businesses stressed by changing rules
When it comes to PPACA, employers are both moving ahead with compliance while still struggling with the shifting deadlines and unclear regulations that have plagued the health reform law.
The PPACA originally required employer mandate to start in 2014. Under the mandate, employers were supposed to have a health plan option that met federal standards available to workers at the beginning of this year. That deadline got pushed back a year for large employers (over 100 employees) and to 2016 for businesses with 50 to 99 workers. Companies with fewer than 50 workers are exempt. Under the mandate, larger employers must offer health insurance by January or pay a fine of $2,000 per worker.
As businesses work with their insurance carriers to meet PPACA requirements over the next few years, experts are advising them to make good-faith efforts to comply with the letter of the law, no matter how confusing it may be. “Err on the side of making coverage available and reduce your risk of penalties,” wrote Keith McMurdy, an HR attorney with New York-based Fox Rothschild. McMurdy wrote in the Employee Benefits Legal Blog that it’s better to be safe than sorry. “Good plan sponsors want to avoid being the test case when it comes to compliance,” he said. “Don’t be the first ‘bad example’ for PPACA compliance.”
The confusion and uncertainty is taking a toll on some. “Employers are freaking out,” said Aaron Davis, president of NextLogical Benefit Strategies in Westminster, Maryland, in a recent BenefitsPro.com article. “The law has changed 30–40 times so far, so everyone is asking if they’re in compliance. It creates stress, so brokers use that and deluge people with information.”
High deductible health plans: Not a silver bullet, but growing in popularity
If you go by some media accounts, high deductible health plans are the Jekyll and Hyde of the health insurance world. On the one hand they free consumers from the grip of high premiums ad give them more input into their health plans; on the other, they ravenously attack consumers’ finances if illness or injury strikes.
A more nuanced approach is that HDHPs are popular for a reason: there are many out there who are relatively healthy and can afford higher deductibles for their rare health care visits. For employees with chronic conditions or who are more likely to need health services, HDHPs may not be the best choice or may need to be coupled with additional insurance products.
But the popularity of the model is growing. A survey by Bankrate.com found that more than 40 percent of Americans say they prefer HDHPs, and the low monthly premiums were the main draw. Another survey found that almost 20 percent of employers switched from traditional health insurance plans to HDHPs in 2013.
Because HDHPs can make insurance more affordable for younger, healthier people, the industry is seeing more and more carriers offer some kind of high-deductible option. “HDHPs are rapidly becoming the plans of choice — for employers, for other purchasers of health benefits, and for public sector plans offered through state exchanges under the Affordable Care Act. In short, HDHPs have unleashed forces that will compel stakeholders to adjust to new realities,” said “Leah Binder, president and CEO of The Leapfrog Group, in an article published by the Harvard Business Review.
To ease the risk equation for HDHP enrollees, some HR experts are recommending the addition of voluntary benefit plans, which can cover unexpected health care costs such as critical illness or accidents.
According to the Healthcare Trends Institute, voluntary benefits come in many forms and can be used to supplement HDHP benefits with first-dollar coverage prior to an employee’s deductible being met. “Voluntary benefits do require education so that employers and employees properly understand their use and value,” post at the institute’s website said. “They require administration too, something that ideally is integrated from a technology standpoint into their systems and with mobile applications to make it easy for benefit specialists and employees.
Photo: Getty Images
Wellness programs evolve
Offering wellness programs to employees has become very common with large employers, and the growth of such programs will likely continue in 2015. Even thought it is difficult to measure how much such efforts are holding down health care costs, employers still see them as a path to a healthier, more productive workforce — and employees like the additional perk.
Employee Benefit Research Institute recently conducted a health benefits survey and found that Nearly 36 percent of employers expected to add wellness programs in 2015.
Another trend is the use of personal devices such as smartphones or Fitbit-type fitness trackers, which can provide metrics about exercise, motion, even sleep patterns. Mixed with social networking, these new technologies can provide significant incentives to engage in, and stick with, healthier activities.
Megan Spurling, wellness program manager at Sharp HealthCare, a San Diego-based health system with 16,000 employees, said he company has been very pleased with how Fitbit trackers were being utilized in wellness programs. Spurling reported good participation and commitment to the company wellness programs, in part because the Fitbit technology is so flexible.
“We have a 24-hour workforce, we’re very diverse, we have locations across San Diego, and we needed a way to engage people no matter how they liked to pursue physical activity,” she said. “Rather than offer a gym membership, we think this technology is helpful in creating a way to get people engaged in their fitness wherever they are.”
Photo: Associated Press/Lee Jin-man
Generational changes: The challenge of passing the torch
One of the biggest HR stories in 2015 may be the growing realization that an incredible amount of institutional knowledge is being lost as baby boomers retire in increasing numbers. So far, few employers have put a priority on dealing with the changing demographics of the workplace. But they may no longer have that luxury; as more than 100,000 Americans retire every month, something has to be done to replace this important resource.
“We’ve talked for a decade about the impending doom of baby boomers retiring,” said Tim Sackett, President at HRU Technical Resources, based in Lansing, Michigan, and a blogger at Fistful of Talent.com. “I think companies are really starting to feel that. In 2015 it’s going to start really hitting companies hard.”
Sackett says companies are dealing with two issues: as the economy improves they’re trying to hire more people, but at the same time they’re losing valuable employees to retirement. How those skill sets can be shared with the younger generation of workers is something many companies have not really focused on, he said. “For the most part, companies are totally unprepared for this kind of knowledge transfer,” Sackett said.
The good news? The millennials — and other young workers — are not as different from older generations as the media has portrayed them to be. “Every generation changes the workforce,” Sackett noted. “What nobody talks about is that with millennials, it’s a generation that grew up in a recession. What we’re starting to see is people who grew up and saw their parents lose their job, or lose their house. They saw major life situations happen; and you end up with kids who value the work, value the job, value the loyalty.” Businesses and workers both evolve with the times, he said.
Flextime, telecommuting are growing more popular
Employers and HR departments are likely to hear more about flexible work arrangements in 2015. Attitudes toward flextime work and telecommuting have been changing in recent years. For example, when employees starting working from home, the concern was that they would be easily distracted, or slack off with no manager around to oversee them. As it turns out, one of the major issues of telecommuting has become workers who don’t know when to shut down.
With more emphasis being placed on work/life balance and the increasing ease of doing work via mobile devices or computers, it’s not surprising that many workers are taking advantage of flextime or telecommuting options. Employers can improve morale while still maintaining productivity by exploring these options, but of course there are some pitfalls, including legal issues around overtime pay.
Research done by Society for Human Resource Management and the Families and Work Institute found that the number of employers offering work-from-home opportunities rose from 34 percent in 2005 to 63 percent in 2012. And a recent Stanford University study found that overall, 10 percent of the U.S. workforce can now be classified as remote workers.
Overall, though, flexibility in work arrangements remains a good option for some, but by no means all, of the workforce.
“The sales associate at a retail store can’t telecommute. There are always going to be some jobs that don’t lend themselves to remote work,” said Lisa Horn, an executive with the Society for Human Resource Management. “But in the information age that we live in, many more jobs will lend themselves to remote work.”
Photo: Getty Images