The economy has put employers under increasing pressure to reduce the cost of benefits, with many seeking better deals from providers and insurers, says Debbie Lovewell
As the economic climate has deteriorated once again over the past year, more than half (57%) of respondents say they have come under increased pressure to reduce the cost of offering benefits. This is now the top effect of the economic climate on benefits over the last 12 months.
To tackle this pressure to reduce costs, a number of employers appear to be putting greater pressure on healthcare benefits providers and insurers to offer more competitive deals. Just under half (49%) say they have reviewed some, or all, of their benefits providers over the past 12 months, while 40% have reviewed their healthcare providers to obtain a better deal and 39% have rebroked their insurance benefits. This is similar to the 46% of respondents in 2010 that said they had reviewed providers to get a better deal during the previous 12 months when the country was in recession.
This need to keep a tight rein on costs looks set to continue over the coming year, with 41% of respondents saying they do not intend to take any action around healthcare benefits in the next 12 months. Perhaps they have already carried out a benefit and cost review so feel they are unlikely to obtain a better deal yet, or they may have no budget available for any significant changes.
Where employers do intend to take action, the most popular aim is to increase the number of healthcare benefits on offer. This may be because they are keen to ensure staff remain healthy, particularly in organisations where it has been necessary to reduce headcounts and the remaining staff may be under increased pressure.
Offering healthcare perks through a voluntary benefits scheme, placing them in an employer-funded flexible benefits plan and increasing the number of staff covered by certain benefits are also key aims for respondents in the coming year.
Read more Healthcare research 2012