4 Employer Considerations In A Changing Economy

Jan 24,2023

Read Time 3 Minutes

When economic theories and financial projections dominate the media and public discussion, it’s only natural to assess financial health and prepare for possible impacts to your business.

A closer look at your organization’s financial health could include how healthcare coverage costs impact your bottom line. To maximize your return on investment and strengthen your organization in the near-term and the future, keep these four considerations in mind.

  1. Understand Fluctuating Healthcare Costs

    Healthcare costs tend to increase during an economic downturn due to higher prices, inflation, and increased use of health services, as shared by a recent Kaiser Family Foundation panel. Historical data indicates that healthcare-related product and labor prices often increase under recession conditions.

    Healthcare cost increases have traditionally trailed behind inflation rates, often due to pre-negotiated payor contracts. As those contracts expire, new agreements may need to accommodate increased costs and could mean price increases.


  2. Evaluate Your Organization’s Health Plan Offerings

    Independent of economic changes, successful businesses strive for sustained growth to increase revenue over time. Part of being a forward-thinking company is evaluating your current coverage options and comparing them against your employees’ needs. 

    Learn more about innovative, forward-thinking plans that can help lower your care costs without sacrificing quality. Explore how you can invest in providing comprehensive whole-health support, advocacy-based solutions, or digital-first access to healthcare information and plan resources. 

    By doing so, you make it clear to both current and prospective employees that your organization is constantly evolving to provide the most robust benefits available.

  3. Recognize Employee Needs In A Competitive Job Market

    As the job market continually evolves, employees are pursuing higher wages and more comprehensive benefits — meaning employers need to stay competitive to successfully attract and retain top talent.

    A recent McKinsey survey showed that 40% of employees considered themselves at least somewhat likely to leave their job within the next three to six months — with almost half willing to leave their current job without a new one lined up. The single biggest cause for employees quitting? They did not feel valued by their organization.

    Compensation, well-being support, and comprehensive health benefits are critical components of how a business shows it values its employees. While directly supporting financial well-being, businesses can also use these offerings to empower employees to care for their physical and mental health, which in turn can boost morale, productivity, and retention.

    Fostering an inclusive workplace, offering a flexible work environment, and providing opportunities for transparency around mental health and wellness benefits can help support employees’ unique and personalized needs — and it’s what they now expect from their employer’s benefit plans.


  4. Foster A Culture Of Long-Term Sustainability

    Reactive decision-making is occasionally warranted to address crises, but this is not a sustainable long-term approach for the long-term health of your organization. Because reactive decisions focus on surviving a particular acute event, they often ignore future consequences.

    An example of reactive decision-making would be if a business, in light of recession talks, opted to cut back their insurance coverage. This may save costs during the quarter it is implemented, but disgruntled employees are likely to leave for businesses that provide them with these benefits as part of their compensation package.

    So what does this mean for your business? Now is the time to re-examine benefit offerings and consider transitioning into more innovative care models, like value-based plan design. Value-based plans provide a platform to minimize business costs without compromising high-quality employee care. Combined with advanced data-driven tools like the SydneySM Health app, your organization can leverage human-centered resources to enhance employees’ everyday lives, enabling a more predictive, proactive, and personalized approach to care — in any economic environment.

    When employees feel physically, mentally, and financially secure, they’re more engaged and productive. As your business navigates economic cycles, always remember how important your support is to your employees’ well-being. Reconnect with your core values and long-term objectives while considering what drives your business and bottom line — including the benefits that bring the most value to your organization.

 

Sydney Health is offered through an arrangement with Carelon Digital Platforms, a separate company offering mobile application services on behalf of your health plan. ©2023