Benefit Trends Accelerate in a COVID-19 World

Scott Galloway, professor at NYU Stern School of Business characterized the pandemic as more of an ‘accelerant’ than a ‘change agent’. Whatever trends were happening prior to the pandemic have been accelerated, and employee benefit strategies are no different. Employers who want to grow margins are pushing the limits of benefit strategy:

Telemedicine. It’s no surprise that Telemedicine has grown leaps and bounds. Participants looking to stay out of the doctor’s offices contributed to a spike in Telemedicine visits. It used to be that there was little or no wait for an online visit. During the pandemic, wait times ballooned, but have now settled back down as vendors such as TeleDoc and others hurried to expand networks. Telemedicine training should be a key component of any benefit education strategy.

Consumer Driven Plans: In the last five years, consumer driven plans have surged in popularity and enrollment, driven by employer need to manage cost. Those employers holding on to Platinum style plans will find it increasingly difficult to offer such rich benefits going forward. Employers are making greater use of Health Reimbursement Arrangement (HRA) dollars and Health Savings Accounts (HAS’s) than ever before.

Mental Health Support: Prior to the pandemic, Mental Health was starting to get some real traction on the importance of taking care of one’s mental health. Many employers have increased their Employee Assistance Programs both in terms of services provided and communications in support of the plans. The beginnings of those investments, it turns out, was to provide a critical foundation for what was to come. The mental health impact of the pandemic is going to continue to increase as we go deeper into the pandemic and resulting recession.

Helping Employees Tackle Debt: Prior to the pandemic and resulting economic collapse, US Consumer debt had risen to it’s highest levels since the financial meltdown in 2008. The increase in debt is across all sectors – tuition, credit card, auto and home mortgage. While not a direct impact to employers’ bottom lines, financial stress of this degree has several negative impacts on employees that DOES impact the bottom line. Absenteeism, decreased engagement levels, increased turnover, and staying on the job too long are all direct cost factors. There are new tools available to employers to assist with tuition debt, savings plans and financial education – without selling products that can easily be deployed with little or no cost, and help build a culture of financial prudence.

In a time of such business volatility, employers have to be smart about how to deploy their precious resources. But, failing to invest the right way in one’s workforce will have dire consequences when we begin to normalize.

Information is provided by Relational Advisors and written by Mike Rankin, a non-affiliate of Cetera Advisor Networks LLC.