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By MATTHEW BRODSKY, senior editor/Web editor of Risk & Insurance®

The analysts at Towers Perrin are upbeat after surveying 480 HR and benefits executives from mid-size and large U.S. corporations. It appears that the message has sunk in--that benefits are crucial to a happy, productive workforce--and it remains sunken despite the current pummeling economy.

Perhaps one of the biggest indicators of the employee benefits "sea change," said Cameron Congdon, a principal with Towers Perrin, is that more than half of the companies also reported they did not cut back on benefits communications.

"Organizations have really finely latched on to [that] this is important to managing our expense, but even going one step beyond that, that it has a positive impact on engagement and morale," the 20-year veteran of healthcare consulting said.

It's all the more impressive that, despite the economic downturn, employers still want to send the message to their workers that "we still care about you."

But it makes sense, if you accept the principle that maintaining a healthy workforce leads to business success, is now "ingrained at a senior level," Congdon explained.

"It's become more like motherhood and apple pie," he added.

FLIP SIDE

Yet the Towers Perrin findings have a flip side that isn't as warm and fuzzy.

Start simply with some of the announced findings that 51 percent of employers plan to, or already have, reduced or eliminated subsidized coverage for future retirees. Or that 52 percent of respondents admitted to increasing or planning to increase healthcare cost-shifting to workers.

Things get even more interesting when you read between the lines of the news about wellness. According to the findings, nearly half of the respondents have or might introduce or increase "penalties" for nonparticipation in wellness or other health-improvement programs.

Organizations have been "migrating" toward disincentivizing, to use a consultant's term, poor health and bad behavior, according to Congdon.

"They've moved from the feel-good incentive ... to, 'It's going to cost you more,' " he said.

Such cost-shifting--or accountability shifting, as Congdon called it--could become more of an imperative should national reform fail and healthcare inflation continues to drain the balance sheet.

Employers will not put up any longer with unhealthy employees who refuse to make the lifestyle or medical changes needed to get better (and cost less). Congdon knows of at least one company that now mandates employees take biometric health analyses before allowing them to participate at all in the benefits program.

More and more employers might begin tellingtheir employees, " 'You have to do these things for the highest level of coverage,' " according to Congdon. "It's clearly an accountability shift."

Still, even the "feel-good" programs bump up against federal medical privacy and discrimination laws. (Hello, HIPAA?) And the Equal Employment Opportunity Commission is currently reviewing the issue of whether employers can incentivize (or disincentivize) workers to participate in such programs.

Congdon expects an EEOC ruling soon enough that it will affect the way employers do wellness initiatives in 2010. In fact, he said, many employers are waiting to see how the EEOC answers this "big question mark" before moving forward with any changes.

"It does cause organizations to pause as to how far they can go," he said.

June 25, 2009

Copyright 2009© LRP Publications