Most employers offer traditional benefits like health care, however, benefits advisors think new benefits will gain popularity within the year. Will traditional health care expand to include mental health and fertility care? How will employers respond to the economic downturn in terms of benefits?
Here's what industry thought leaders think will happen within the benefits world:
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2023 is the year that fertility becomes health care
In recent years, a rapidly increasing number of employers and insurers have recognized that they need to better integrate fertility care, which has historically been an out-of-pocket cost affordable only to a select few, into their core offerings. What's happening now is there is a deeper understanding of the role of incentives in this space. In practice, that means benefit providers are being measured on both the efficacy of an individual IVF cycle and their ability to prevent the need for IVF in the first place. That's real preventive care — the name of the game in every corner of health care except this one. We're finally seeing that change, which is something to celebrate.
Kate Ryder, CEO and founder of Maven Clinic
Comprehensive benefits packages will continue despite the economic downturn
With quiet quitting, the tight labor market, and The Great Resignation, company leaders and HR managers learned last year that comprehensive benefits packages are imperative to attracting talent and retaining existing employees. In fact, according to Gallup, 64% of employees named "pay and benefits" as a critical factor in taking a new job. The war for talent will continue to drive benefit enhancements, and a recent survey from Mercer found that 70% of all large employers are planning benefit enhancements for 2023. In the new year, this will be especially important with the economic downturn, and we're already seeing massive layoffs, particularly in the technology sector. HR decision-makers will need to lean on competitive benefits packages that focus on prioritizing health, wellness, and employee outcomes in order to keep top talent.
Sheri Atwood, Founder and CEO of SupportPay
Personalized benefits navigation
Employers need to offer employees not only more benefits, but a better way to navigate those benefits. We'll see more companies look to enhance the personalization of their benefits' navigation so that their employees can use the right benefits at the right time and overcome usage barriers. As we've seen with health care with companies like Accolade, we'll start to see more employers look for these types of navigation-focused solutions for their financial benefits as well.
Tom Spann, CEO and co-founder of Brightside
Fixing the Family Glitch will accelerate a shift away from employer sponsored health care
We're closely watching the impact of the IRS 'fixing' the 'family glitch.' The prior rule prevented families from qualifying for ACA-subsidized insurance if one family member received coverage from their employer that was deemed affordable, even if the cost of covering the entire family was not affordable. This development should have an enormous impact on employer-sponsored health insurance. Because employees can now go to the exchanges to get insurance subsidies for dependents, some or many employers may reduce the amount of dependent coverage they offer employees. This fix may well be a catalyst for the shift away from employer sponsored health care.
Michael W. Levin, CEO of Ideon
Increase the scope of benefits offerings
As we have seen greater adoption of holistic health approaches, there has also been an increased desire from consumers who want complete sets of benefits, and comprehensive omnichannel experiences. Likewise, we are also seeing many employers increase the scope and coverage of their benefits offerings in order to showcase a stronger value proposition.
These trends will continue in 2023, which will include greater personalization of benefits (microtargeting), and the increased proliferation of low-cost/no-cost offerings such as critical illness, long-term care, and disability.
Employers will expand leave and benefits policies for caregiving
What the pandemic revealed is that companies have long underestimated caregiving and the way it impacts employees' careers. No longer is caregiving solely defined as an employee taking care of their kid(s). The reality is, employees today — majority of whom are Millennials or Gen Z — are increasingly responsible for taking care of elderly loved ones and looking for even more support and flexibility when it comes to work-life balance and benefits. This means HR leaders will need to reapproach these benefits from a holistic perspective that encompasses more than just parental leave. 2022 scratched the surface, with 59% of organizations stating that a dependent care flexible spending account to save funds for caregiving-related expenses is offered to employees. I suspect 2023 will be the year employers dig deeper — revisiting leave and benefits policies to encompass a broader definition of caregiving, and underscoring the importance of delivering support to employees through benefits.
By expanding policies around caregiving to include more than parenting, employers demonstrate to their employees that they have the support and offerings needed to care for their loved ones. This not only alleviates strain and stress felt by employees, it also lays a strong foundation for the current and future workplace, and provides the fundamental building blocks needed to create a workforce that feels valued.
Lenke Taylor, Chief People Officer at Level
Enhancing benefits without increasing costs
Employers will likely enhance benefits without increasing costs by rolling out supplementary health benefits, like hospital indemnity insurance. LIMRA recently reported that hospital indemnity sales jumped 12% year over year in 2022. We expect demand for this benefit to increase in 2023. The continued rise of health care costs coupled with the experiences many had with COVID over the past two years, American workers understand the importance of having a financial safety net that can supplement what their health insurance might not cover in the event of an unexpected hospital stay.
Employers are also looking at what kinds of non-insurance benefits they can offer, like more time off, flexible work schedules and paid leave benefits.
Stephanie Shields, head of Employee Benefits at Equitable
Frictionless benefits
Benefits are more important than ever. 2023 will be an acceleration year for frictionless benefits, with the member experience taking center stage. People need confidence in their coverage, and technology plays a vital role as a critical enabler to fuel advances for everyone in the benefits ecosystem: employees, employers, carriers, benefits administration software firms and brokers. Expect to see more embedded benefits, greater variety in benefits options such as fertility, elder care and tuition reimbursement, and broad adoption of all-in-one solutions that unify many of today's point solutions for HRIS, benefits, and payroll.
Shannon Goggin, CEO and co-founder of Noyo
Employers continue to absorb health care premiums and other costs
For the last two years, some employers have opted to absorb premium increases in efforts to alleviate financial stress for their employees. But this isn't sustainable long term, so more employers will consider other plan design tactics to promote affordability such as tiered deductibles and out-of-pocket maximums, pay-banded premium contributions, or salary-tiered Health Savings Account contributions. Providing a choice of health plan options (e.g., copay plans or hybrid copay plans) that are more affordable and predictable at point of service is another consideration.
David Foster, Principal, Health Practice, Buck
Progressive employee benefits
Next year, progressive employee benefit programs, including financial wellness, will come under pressure. Research this year already shows that 88% of employers have begun offering perks to entice employees to return to the office – such as commuter stipends, free lunch and other office perks. Rather than getting employees back at their desks, employers need to focus on benefits that drive real engagement and address equity and inclusion, such as critical financial wellness support – especially student loan management. With President Biden's Forgiveness plan on hiatus for the foreseeable future, and repayments expected to resume next year, employees with student loan debt are left in a state of chaos and uncertainty about how much their monthly payment will be and when they'll need to start making it again. Companies must not only support employees by making sure they are able to access critical relief programs, such as Public Service Loan Forgiveness and the newly proposed income-driven repayment plan, but they must also adopt some of the tax-advantaged benefits that have been made available, like employer-sponsored contributions to employees' student loans.
Laurel Taylor, CEO at Candidly
Push for SUD treatment
Congress is expected to develop legislation to provide greater oversight for mental health and substance use disorder provider networks. Two key proposals that are currently in development include Senate bill S. 5093, sponsored by Sens. Tina Smith (D-MN) and Ron Wyden (D-OR) and the bipartisan H.R. 5888. These proposals would require new monitoring and reporting on health plans' provider networks for mental health and substance use disorder services. Proposals in both the House and Senate would also include requirements to ensure the accuracy of provider network directories. Proposals also include varying approaches to analyzing the adequacy of the mental health and substance use disorder provider network either pursuant to specific standards or in comparison to networks for medical and surgical providers under mental health parity.
David Shillcutt, Senior Counsel, Epstein Becker Green P.C.
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