As health care reform provisions are coming down, human resources and finance departments are practicing an increasingly shared role when it comes to benefits, rewards and compensation, says Randall Abbott, senior health and group benefits consultant at Towers Watson, a global professional services company in New York City. While health care reform and associated costs are not the only factors influencing this stronger partnership, they are catalysts because they are issues that affect an employer's HR department as well as its finance department. For the HR department, health care reform affects the budget for compensation and talent management while overall business costs are impacted by the upcoming provisions, which is a concern for the finance department.

"Many organizations are seeing health care reform increasing their costs from 0.5 percent to 4 percent for health care, and that's just in the most recent times," Abbott says. "In the longer term for 2014 and 2018, various health care reform mandates are being created that add costs that will affect compensation and the financials of a business."

This is especially true as the work force is shifting its demographics, Abbott says. Many employers are facing the challenge of training and developing the millennials as older workers with unique skill sets are preparing to retire. While HR is responsible for managing talent, there is also a large associated cost with doing so, and the finance department should be included in the planning and transitioning processes.  

Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.

  • Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
  • Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.