The employee healthcare benefits reckoning is here. The enduring impact of COVID-19 has converged with digital transformation – especially the accelerated advancement of data collection and analytics – to create sweeping changes in employee-employer relations. The chaotic pace of change in managing remote workforces and retaining top talent has placed an enormous strain on employers. Meeting bottom lines while addressing significant increases in employee healthcare costs and premiums can become an existential struggle.

Today, employers are adopting an integrated and innovative data-driven approach to balancing the fiscal health of their businesses with high-quality benefits that valuable employees demand (in addition to traditional salaries) for their talents, loyalty, and services. Employers are exploring avenues to leverage digital technologies and virtual health platforms that cater to various aspects of employee well-being – while also pursuing partnerships with hospitals and physicians to help manage increases in healthcare costs and premiums for their workers. Technology will help bridge human needs and healthcare resources by offering flexible plans, suggesting effective uses of earned benefits, and helping to create benefits packages that are tailor-made for each employee.

A Global Epidemic of Unwellness

The rapid proliferation of remote workers and teams in response to the global pandemic profoundly reduced the level of interaction between employees and employers. This new dynamic took a significant toll on the social and psychological well-being of employees and compelled employers to seek resources that could identify and address the consequences of being confined to isolated environments where interacting is primarily done via laptops and digital devices. Stress, for example, has become the leading risk factor in employee mental health, with spikes in both depression and anxiety rising sharply, largely due to feelings of isolation created in the wake of COVID-19. Though limited amounts of stress are typical in the workplace, excessive stress produces significant hazards that impact well-being and productivity. Mental health challenges can emerge at any time, so employers must be vigilant.

To address this global epidemic of unwellness, employers are conducting recurring virtual check-ins with employees to detect signs of mental health challenges such as difficulty concentrating, increased fears and worries, worsening mood, social withdrawal, or decreased work performance. Corporate human resources units are beginning to use virtual reality technology previously employed by psychotherapists alongside apps that provide self-help information and offer guidance. Genentech, for example, now offers free subscriptions to meditation apps, and Bell provided employees 24-hour access to online mental health tools. Additionally, businesses are offering mental, financial, and social health initiatives to supplement the traditional physical health benefits, and helping employees use the various aspects of virtual health like telemedicine and e-pharmacy to access real-time, personalized medication and care.

The Merging of Employer/Healthcare Partnerships

More than two-thirds of Americans get their health insurance from private insurers. More than half of all insurance coverage is employer-provided. With the impact of recent events such as the pandemic, the cost of healthcare will continue to rise and, consequently, so will the premiums for employer-sponsored health plans. Employers need to plan for this eventuality. Since our post-pandemic future remains uncertain in terms of how healthcare will be delivered in cost-effective ways, employers should take decisive actions and invest in developing more comprehensive strategies. Employers, for example, can better weather the ups and downs of this unsettled future by:

• Partnering with the health systems that provide care for their employees
• Establishing clear expectations for high-quality and low-cost care
• Discussing innovative ways and processes used to provide care via technology
• Leveraging telehealth and virtual care solutions to achieve wellness goals

Employers are increasingly prioritizing employee health and well-being rather than healthcare plans and exploring more personalized plans that offer reduced premiums and more choices. In fact, some companies have created new contributory and voluntary benefits, including programs where people with similar conditions form a group that providers treat as a group rather than individual patients. Furthermore, empowering employees to customize their benefits from a wide range of emerging benefits – such as pet insurance and even insurance to cover out-of-pocket healthcare costs not covered by medical insurance – allows employers to address their employee’s holistic health and well-being needs. This proactive and more targeted approach to individual health priorities creates better outcomes and lowers the risks for the health insurance companies, thereby reducing premiums for medical plans.

Data-Driven, Personalized Healthcare Solutions

Healthcare payers and providers hold a gamut of valuable patient information. The confluence of “Big Data,” which enables digital methods to collect, store, and track patient records, with smart devices like smartphones, wearable devices, IoT applications, etc., allows people to monitor their health and interact with their doctors in real-time. This enables the immediate analysis of illnesses and reduces human-caused inaccuracies and delayed diagnosis. Healthcare data analytics and machine learning play a major role in devising personalized medicine strategies that offer the best treatment options for the patients. Ever-increasing claims and EHR (Electronic Health Record) data, coupled with the power of genomic medicine and data analytics, profoundly improves genetic transparency and personalized care options for specific medical services.  

With more data to guide payers, providers, and patients towards the most effective, lowest-cost care plans, customized care contracts around genetic testing and personalized therapies will likely become a more common technique for controlling costs and fostering better patient outcomes. The future of healthcare will be significantly driven by digital transformation enabled by interoperable health data on secure, open platforms.

Consequently, healthcare will concentrate more on well-being rather than reacting to an illness. With more focus on retaining talent and accommodating diverse workforces and individual needs, healthcare will increasingly use personal data to implement moves towards patient empowerment and patient-centric care. Value-based care – paying for outcomes as opposed to a fee for service or a procedure – has also been gaining traction recently and will become a standard expectation from employees regarding benefits. The employee healthcare reckoning was long overdue, and though the pandemic may have spurred much-needed change, data and technology will continue to define the future of employee benefits.