U.S. employers double down on controlling healthcare costs, enhancing affordability

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[{"type":"text","content":"Seven in 10 employers expect moderate to significant cost increases over the next three years, WTW survey finds\nARLINGTON, Va., Sept. 15, 2022 (GLOBE NEWSWIRE) -- Two out of three U.S. employers (67%) plan to prioritize controlling rising healthcare benefit costs over the next three years. And with many employers expecting costs to rise steadily in the foreseeable future, they are pursuing several initiatives to manage costs and make benefits more affordable for employees. These are among the key findings in a new survey by leading global advisory, broking and solutions company WTW (NASDAQ: WTW). The survey found U.S. employers project their healthcare costs will jump 6.0% next year compared with an average 5.0% increase they are experiencing this year. Most employers see little relief in sight, as seven in 10 (71%) expect moderate to significant increases over the next three years. Additionally, over half of respondents (54%) expect their costs will be over budget this year. On top of managing costs, 42% cite managing employee affordability as a top priority. To address a higher-cost environment, 52% will implement programs or switch to vendors that will reduce total costs; one in four (24%) will shift costs to employees through higher premium contributions. “With no end in sight to projected cost increases, the need to manage healthcare costs and address employee affordability has never been greater,” said Courtney Stubblefield, Insights & Solutions leader, Health & Benefits, WTW. “Yet, with so many potential actions, employers must focus on changes that go beyond addressing their employees’ needs to also support efforts to attract and retain talent during a tight labor market.” The survey of 455 U.S. employers revealed several actions employers implemented or used this year, or expect to pursue, to manage costs and enhance employee affordability. These include: Health plan budget boost: Two in 10 employers (20%) added dollars to their healthcare plan without reallocating funds from other benefits or pay. Another 30% expect to do so in the next two years.Defined contributions: Four in 10 employers (41%) reported using a defined contribution strategy with a fixed dollar amount provided to all employees that differs by employee tier. Another 11% are planning or considering doing so in the next two years.Evaluate employee contri...

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