2022 Health Benefits: Preparing to Make Partnership Decisions

by Charles Marentette

In a season marked by gaping labor shortages, everyone from McDonalds to Silicon Valley is trying to woo employees with the latest and greatest health benefits on the market.

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There is no question that we’re in the midst of a serious labor shortage, and financial executives across the country are feeling its effects. In this tight labor market, we’ve never been more aware that employees are our greatest asset. If you weren’t already, you’re likely taking a hard look at your benefits packages and identifying ways to maximize your return on investment, to better attract and retain talent, as well as improve outcomes and control costs in the long run.

One of the most important components of an attractive benefits package is of course, healthcare. A recent study found half of employed Americans make job decisions such as whether to switch jobs or retain a position based largely on their health benefit options. So how can you improve your offerings in 2022? Below are five key partnership questions to ask as you go into meetings with your broker that can guide your decisions on everything from funding models to the benefits themselves:

  1. What type of partner do you want to have?

I would argue the single best thing you can do is partner with people who care about your employees as much as you do and are committed to evolving to meet their needs.

When it comes to your current benefits provider, ask yourself: do they really value my feedback? Your partner should be eager to join you in the process of changing, adapting and feedback looping until you’ve landed on a product together that truly satisfies the needs of your company and your employees.

At Gravie, we have a very high customer retention, and I truly believe this is because of our approach in listening to and delivering on what our brokers and employer clients express that they need. We’re constantly asking our clients for feedback. Is your health benefits partner doing the same? If not, ask yourself whether they are truly an asset to your organization.

  1. What do your employees want out of their health benefits?

COVID-19 and its effects fundamentally changed what employees want and need from their employers – and health benefits are no exception. Listening to your employees is the first step to identifying what they want most out of their health benefits.

Once you’ve identified the top needs of your employees, you can move on to evaluating whether your current partners can satisfy their needs, or whether it might be time to make a change.

  1. How are your current benefits partners doing?

If the pandemic has taught us anything, it’s how to pivot and evolve quickly. We shouldn’t wait until enrollment season to assess whether our partners are working for us or not. Instead, we should always be challenging them to listen to our feedback and as a result, evolve their products to better meet our employees’ needs.

While some plans might look better on the outset, taking the time to evaluate them once your team has started using (or not using) their benefits will really show you if they are working well. It’s also a good way to gauge whether your employees have a strong understanding of the resources available to them through their plan. Analyze your claims data, whether your employees are regularly taking advantage of any auxiliary services your carrier provides, and the ways in which they are using their plans. Combine this hard data with more qualitative information as well – have your employees shared positive or negative member services experiences, is HR hearing complaints from certain demographics in your company more than others (e.g., single vs. married, kids or no kids, etc.), and are prospective employees truly impressed with your benefits conversations at the negotiation table?

In addition to evaluating how the partnership is going for your employees, don’t forget to take stock on how it’s working for your company as well. Are your partners offering you benefits that help ease administrative burdens? Are you reaping benefits like surplus rebates, and is your partner focused on ensuring predictability and even a fixed cash flow? Good partners will care not only for your employees, but your enterprise as well.

  1. What type of investment are you willing to make?

I would be remiss if I didn’t mention how costs factor into partnership decisions. Of course, at the end of the day, costs will always be a key consideration for financial executives. While you need to do your due diligence to make sure the price is right, I would argue the true test of whether you made a good selection will be determined by the value you see in return, and health benefits are ultimately a long-term investment.

The initial goals you might be looking to achieve with your health benefits are likely focused on impressing employees – whether recruiting new team members or retaining existing. Then from an ongoing and long-term perspective, you need a health plan that will actually do what it says it will do – support the health of its members. Is your plan one that will improve your employees’ wellbeing and keep costs down for everyone over time? If not, then saving a little money here or there doesn’t matter if it’s not moving any needles. Once you’re in the right ballpark with the investment, the nuances of cost pale in comparison to finding a high-quality, innovative partner who is as committed to your employees’ long-term health as you are.

  1. What type of funding model is the best fit for your company?

When it comes to how your plan is funded, there is a wide spectrum of models that balance the amount of risk a company assumes with the flexibility they are afforded. Deciding which model is best for your organization -- whether it’s self-insured, level-funded, or fully insured, will be critical as you make partnership decisions.

In a season marked by gaping labor shortages, everyone from McDonalds to Silicon Valley is trying to woo employees with the latest and greatest health benefits on the market. As you begin making benefit decisions, take a hard look at your offerings and ensure you’re using every arrow in your quiver to attract and retain talent. It starts with identifying the right partners.

Charles Marentette is the Chief Financial Officer for Gravie.