Employers surveyed plan to enhance benefits in 2023 to attract, retain talent

To improve talent attraction and retention, many U.S. employers are planning to enhance health and benefit offerings in 2023, according to Mercer’s Survey on Health and Benefit Strategies for 2023. The survey examines how employers are reworking benefit programs to meet new needs and expectations, and how they are planning to deliver total well-being to employees in 2023.

Over two-thirds of the 708 organizations responding to the survey plan to enhance health and benefit offerings in 2023, with the clear objective of supporting hiring and retention, said Beth Umland, partner, director of research, Health & Benefits, Mercer.

One enhancement is adding virtual care, Umland said. During the pandemic, many employees tried telemedicine for the first time, and survey results suggest they are continuing to use it.

“The majority of survey respondents say they will offer virtual care solutions beyond basic telemedicine in 2023,” she said, adding, “Notably, over half of large employers (52%) will offer virtual behavioral health care in 2023, up sharply from 28% in our 2021 survey.”

In addition, 40% will offer a virtual primary care physician (PCP) network or service, which is more than double the 16% of large employers that offered it in 2021.

Focus on family

Employers are adding a broad range of family-friendly benefits. “In particular,” Umland said, “we saw a jump in coverage for IVF treatment, from 36% to 43% of large employers. Parental leave (beyond the minimum required by law) is now provided by 70% of employers.”

And there has also been rapid growth in family-friendly benefits offered by employers. As Umland explained, “support for building and maintaining a family is increasingly seen as a key element of an employer’s value proposition to employees.

“Especially since the pandemic, employees are focused on a healthy work-life balance, and benefits such as parental leave are now viewed as stable stakes for organization that want to be viewed as an employer of choice.”

In fact, according to the survey, 70% of surveyed employers are currently offering or planning to offer paid parental leave in 2023, and 53% are providing or planning to provide paid adoption leave.

And in keeping with their focus on family, nearly one in 10 large employers (5,000+ employees) said that they provide on-site child care now or will do so by 2023. Also, 22% will provide access to back-up childcare services.

More flexibility for employees

Employers are also focused on providing greater flexibility to employees, both in where they work (nearly 9 out of 10 large employers say they will permit employees to work from home at least once a week on a regular basis) and when they work (66% will permit employees some form of flexibility in their work schedules), Umland said.

Improving health-care affordability

In addition, health-care affordability is a top concern for many workers, particularly low-wage earners or those who are coping with a chronic medical condition.

While high-deductible health plans have grown rapidly over the past decade, employers have recognized that these plans aren’t a good fit for some employees, the survey said.

Over two-fifths of large employers (41%) surveyed currently provide a medical plan option with a low/no deductible, or plan to provide it in 2023, and an additional 11% are considering it.

In addition, 11% offer free employee-only coverage (i.e., no paycheck deductions) for at least one medical plan option, and another 11% are considering it. While free coverage historically has been relatively common among small employers (29% currently offer it), it is a newer strategy for large employers.

When asked if benefits enhancements would be targeted at specific employee groups, about a fifth of large employers said they are focusing on their hourly and low-wage workforce.

The survey was conducted from April 26–May 13, 2022. In total, 708 organizations participated, from all industries and of all sizes: Fewer than 500 employees (36%), 500-4,999 employees (46%), and 5,000 or more employees (18%).

Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at amseka@INNfeedback.com. 

© Entire contents copyright 2022 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reprinted without the expressed written consent from InsuranceNewsNet.com.

Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at amseka@INNfeedback.com.