Physical, Emotional & Financial Wellbeing

Best-in-class employers stand out from their peers in six categories that address the physical, emotional and financial wellbeing of employees:

• Providing competitive yet practical medical benefits

• Designing benefits to promote high-quality, high-value care that improves health outcomes

• Applying a variety of tactics to manage the cost and use of specialty pharmacy benefits

• Supporting financial health and retirement readiness to reduce stress and manage risk

• Addressing work-life demands with robust leave policies

• Acknowledging the unique needs of individual employees through an array of voluntary benefits

Providing competitive yet practical medical benefits

Best-in-class employers are likelier to balance the strength of their core health plans with other coverage. Frequently, they offer a consumer-directed health plan (CDHP) that’s paired with a savings account. Employees usually pay lower monthly premiums compared to other types of plans, but higher deductibles can potentially increase their out-of-pocket costs. To buffer this exposure, employers typically offer a health savings account (HSA) with the CDHP.

Designed to promote consumerism, CDHPs can financially reward employees when they carefully consider and selectively choose lower-cost healthcare options. Organizations benefit, too, because they’re able to reinvest savings in other components of the medical plan.

Other practices help to directly contain costs. Some employers favorably adjust employee medical plan contributions based on certain factors, and the best in class generally outdo their peers. Wellbeing activity is a common variable, with the amount determined by participation in a wellbeing program or completion of a health risk assessment. This particular approach can be broadly applied as an engagement tactic. Top-performing organizations are also likelier to align health plan contributions more fairly with earnings.

Factors that determine employee medical plan contributions

Certain plan options are highly valued by employees who need them but covered by only a portion of employers. The best in class are more likely to offer coverage for applied behavioral analysis (ABA) therapy, autism treatment, infertility and fertility treatments, and gender reassignment surgery and other transgender-inclusive benefits. Overall, employers are increasingly assessing these coverages as part of their workforce inclusion efforts.

Coverage of elective services and procedures

Designing benefits to promote high-quality, high-value care that improves health outcomes

Employers increasingly recognize that the quality and value of the care their employees receive can vary significantly. The best in class are more inclined to proactively address this discrepancy using targeted tactics, including reduced costs for prescription drugs that treat high-cost chronic conditions.

Use of value-based health management tactics

This effort has proven effective for increasing compliance, which supports better disease management. They’re also more likely to steer employees to high-quality providers for secondopinion services.

Applying a variety of tactics to manage the cost and use of specialty pharmacy benefits

As the cost, utilization and availability of specialty drugs rise, employers are likelier to apply an assortment of tactics to keep this category financially viable. The best in class approach specialty pharmacy management more actively than their peers do.

Differences are most notable in mandating the use of a specialty pharmacy, using step-care therapy and moving coverage from the medical to the pharmacy benefit. Behind the scenes, they’re more inclined to review and negotiate pharmacy contracts and to seek lower-cost sourcing options.

Tactics employed to manage the use and costs of specialty drug benefits

Supporting financial health and retirement readiness to reduce stress and manage risk

Financial wellbeing is important on many levels for both employees and employers, threading through several consequential needs including reduced stress, better mental health, higher productivity and on-time retirement. Topperforming employers excel at engaging their workforce to improve financial health through a range of opportunities. Typically, these include financial literacy education, debt counseling, will preparation, estate planning, and loan refinancing tools and education.

To encourage participation in retirement plans and boost savings for employees, the best in class are also more likely to use auto-enrollment.

58% 71%

 Marks a best-in-class response that is lower compared to other large employers

Components of financial wellbeing initiatives

Addressing work-life demands with robust leave policies

A well-structured and competitive absence management policy provides employees adequate time off to fully recover and productively return to work.

The best in class are more likely than other large employers to have a specific strategy for managing and administering occupational and non-occupational disabilities. But coordinating disability and workers’ compensation policies with regulatory requirements is a lesser concern.

HAVE AN ABSENCE MANAGEMENT STRATEGY FOR ADMINISTERING LEAVES AND BOTH OCCUPATIONAL AND NON-OCCUPATIONAL DISABILITIES

CONSIDER COORDINATING DISABILITY AND WORKERS’ COMPENSATION WITH RELATED REGULATIONS A TOP ABSENCE MANAGEMENT CONCERN

Top-performing employers tend to offer more generous shortterm disability (STD) benefits compared to their peers. The benefits level as a percentage of pay is more likely to be 70% or greater, and the weekly dollar maximum is at least $2,500. In defining earnings for long-term disability (LTD), they’re less likely to consider salary only and more likely to include other forms of variable compensation as well.

Part-time employees are more likely to be eligible for paid time off (PTO) if they work for a large best-in-class employer, versus a same-size peer. Extending the availability of this highly valued benefit supports attraction and retention.

At higher rates, top-performing organizations also offer several leave programs other than disability. These options include personal, municipal-mandated and volunteer leaves.

Approach to other leave programs

They also have the edge in providing coveted paid parental leave that’s separate from standard STD. Administration of the Family and Medical Leave Act (FMLA) is more often outsourced by the best in class compared to their peers.

Acknowledging the unique needs of individual employees through an array of voluntary benefits

Voluntary benefits introduce more choice to total rewards by giving employees the opportunity to customize available options to meet their specific needs. Offering a selection that addresses population preferences helps to differentiate employers in a competitive labor market. In 2022, the best in class more often enhanced voluntary benefits.

Employers that offer these benefits can either subsidize the cost or require employees to pay the full amount. Voluntary options that best-in-class employers are slightly more likely to subsidize include employee perks such as discount purchase programs, and identity theft protection. They’re less inclined toward legal services, and auto and home insurance.

ENHANCED

Objectives

40%

27%

Approach to voluntary benefits

 Marks a best-in-class response that is lower compared to other large employers