Peak open enrollment season is just around the corner. So, like many employers, we too are wondering what this year will bring in the way of health care trends. Some find themselves wondering, what will be the key health care trends this year?
As the saying goes, “If there’s one thing we can count on, it’s change.”
1) Health care premiums are expected to rise
There are varying opinions on just how much premiums will rise, but there is growing consensus that premiums will rise at higher rates than recent years. According to Business Source Group on Health, large employers predict premium increases ranging from 5.3% to 6.1%. Meanwhile PwC is projecting average increases of 4-10%. Small employers are bracing for increases as high as 20%.
Some employers expect the real financial hit to come in future years. When COVID-19 stay-at-home orders first went in place, many areas of the country saw a dip in medical spending. This was largely due to cancellations of elective and non-emergency procedures.
Since that time, as BRI saw from its participants, most of the typical spending has returned and overall medical expenses are on the rise. As you are acutely aware, premiums are heavily based on the prior year’s claims experience. Since many areas of the country did not see COVID-related expenses increase until this summer, we will not see a full year’s worth of expenses until well into 2021. So, watch out for mid-year 2021 renewals and beyond.
2) Increased cost-sharing
For employers that are already struggling with financial difficulties, premium increases may force them to consider skinny plans and increased cost-sharing for employees. Employers can make sure they are maximizing each employee dollar with a health savings account and/or flexible spending account.
3) Virtual everything
Every day we hear the latest in “virtual enhancements”. Since the start of the pandemic, we have been introduced to virtual child care, virtual gym memberships, virtual learning, virtual field trips, virtual conferences, and the list goes on.
But, if you are in the benefits or health care industry, the growing trends for virtual health care and virtual enrollment are hot topics that are difficult to ignore. According to a June 2020 study from Mercer, 32% of employers indicated expanding virtual / telehealth services was a top priority.
Additionally, how you prepare for and address the growing need for virtual experiences is also key. Rather than just converting printed benefits packets to digital delivery, decision support tools, like BRI Insights, can help to pave the way to a truly personalized virtual benefits experience.
4) Increased Support for Mental Health
The negative affects of mental health have become all too real this year. According to Metlife’s 2020 Navigating Together study, 2 in 3 employees state that are feeling more stressed than before the COVID-19 pandemic. Further, 73% of employers said reducing employee stress was a key objective for 2020.
Employees cited several programs that would ease their stress. Some of these included: flexible work arrangements, mental wellness programs, and access to health savings accounts and/or flexible spending accounts.
5) Expanding voluntary and specialty benefits
Despite higher unemployment rates, employers are still struggling to hire top talent. With more employees realizing location is no longer a limitation for the jobs they want, the competition for top talent has gotten a little harder. Employers that find themselves in this position may need to consider sweetening the deal with voluntary and specialty account benefits. Specialty account benefits are like designer benefits in which employers identify a need that their employees have and build a benefit around it.
What’s next: Tough choices and potential for radical change
This year has brought a lot of uncertainty on all fronts. Further, it is likely to lead to some tough choices. The specifics are likely a little fuzzy yet. But, we all need to be poised for health care trends to look just a little bit different (or maybe even radically different).