Employers who provide health benefits: size and profitability matter
Employers who are most likely to provide health care and economic security benefits tend to be larger, in business longer, with more unionized employees, more ethnic diversity in top positions -- and they are more profitable than their competitors -- according to the 2008 National Study of Employers.
The Alfred P. Sloan Foundation funded this study researched by The Families and Work Institute (FWI). The Institute, whose slogan is, "When work works," also recently published the 2008 Guide to Bold New Ideas For Making Work Work.
This survey of 1,100 employers builds on FWI's 1998 Business Work-Life Study. Thus, the survey examined health insurance trends from 1998 to 2008. The researchers found that the percentage of employers who provide health care coverage for employees is relatively stable, but the portion employees are covering is much greater than it was 10 years ago. Over one-third increased employees' premium co-pays in the past year for both individual and family health insurance. Only 4% of employers pay 100% of the premiums for families in 2008, versus 13% in 1998. A sign of the new times in the definition of "family" in the workplace: employers are more likely to provide health insurance for unmarried partners of employees -- 31% in 2008 vs. 14% in 1998.
Size matters when it comes to providing health insurance: small employers (with 50-99 employees) are less likely (88%) than large employers (99%, defined with at least 1,000 employees) to offer family health insurance coverage. When they offer health insurance, a greater percentage of small employers pay none of the premium. Small employers are also less likely to provide wellness programs.
Health Populi's Hot Points: While the financial burden that employees covered by health insurance plans at work has grown over 10 years, it is important to recognize the expanding health-focused programs that employers have introduced in the past decade. These include wellness, employee-assistance programs, work-life balance (e.g., flexible working arrangements), alternative health choices, partner benefits, and other creative choices for the diverse workforce. The survey found that more diverse leadership at the top leads to more support for the worker. Here's a lesson to heed as the workplace continues to benefit from diversity.
posted by Jane Sarasohn-Kahn at
7:11 AM
2 Comments:
This analysis seems more correlational than causative. If thats the case, the hot points could be read very differently.
For example, the companies that are the biggest and most profitable may have had the least financial pressure to take benefit savings that other companies have had to take to meet their numbers/survive.
If you also believe then that small companies grow into larger companies and will be starting with a reduced expectation/history of providing rich health benefits, then this information may indicate a faster evolution toward a defined contribution (rather than defined benefit benefits strategy) as legacy companies are replaced oby the small companies who's thinking around benefits evolved in a very different place.
Was there any trending showing how small companies evolved benefits as they got bigger in a way that showed an acceleration of profitability? If so, what is the impact of each of the jobs that health benefits may perform for an employer in driving improved performance?
By
Vijay Goel, M.D., At
June 2, 2008 1:45 PM
Vijay, you raise an excellent point. The first one is the scale issue and the reality that older companies have a kind of benefit-culture and historical momentum which (when they are profitable) impels them to continue to provide benefits. According to new research from the U.S. Chamber of Commerce, a majority of companies do not want to see a single payer system and at least a plurality want to continue to play a major role in benefits provision. But larger companies that are unionized still are compelled to provide benefits -- but in the case of the autos, for example, are hamstrung in competitively global markets by doing so. I take your point on small companies that can grow big--but am uncertain about their commitment to going defined contribution. It's early days there. The trended data from 1998-2008 on health benefits is on page 29 in the report, but it doesn't answer your excellent question on small employers. Your question is, simply put, "what was the benefit of the benefits?" in improving profitability and performance. That we won't be able to answer in this study, but it's a key question. Thanks for the thoughtful ideas. JSK
By
Jane Sarasohn-Kahn, At
June 2, 2008 4:19 PM
Post a Comment
<< Home