March 31, 2010
Public Employers Strive for Healthy Workforce and Healthy Bottom Line
Wellness, disease management and voluntary benefit offerings enrich benefit packages and employees’ lives in lean economic times
—A new survey, Trends in Public Employee Plans, released by the International Foundation of Employee Benefit Plans and co-sponsored by SALGBA, examines how public employers are addressing rising health care costs and how they foresee reacting to health care challenges in the future.
"In the midst of declining revenues, an aging public workforce and rising health care costs, many states and localities are struggling with significant budget shortfalls," explained Sally Natchek, Director of Research at the International Foundation. "Although reported health care premium rate increases are varied, the fact that many employers are holding increases to single digits and bolstering programs to reduce costs and improve the quality of care is a positive note for the future."
Survey findings show that half of public employer health plans have been able to avoid double-digit premium rate increases in 2010, and that the majority of employers are stepping up health care cost control and quality care efforts using wellness initiatives—an option that has traditionally been prevalent in state plans, but less common in municipalities and counties. To help control their portion of health care costs, 57% of public employers report they have increased employee contributions to health plan premiums for 2010.
Strong Uptick in Public Employers Offering Wellness and Disease Management Initiatives
In an effort to control future health care costs, a large number of public employers have turned to health and wellness initiatives. Of the public employers surveyed, 72% offer wellness initiatives, 65% offer a disease-management program (a coordinated approach focusing on reducing costs and improving the quality of life for plan participants with a chronic condition) and 31% offer value-based care initiatives (a consumer-centered approach that uses education, preventive care and financial incentives to improve health while reducing costs).
Most public employers surveyed, 80%, expect to increase their emphasis on wellness initiatives in the next two years. In addition, 72% report they are likely to increase their emphasis on disease management and 57% cite they are likely to increase their emphasis on value-based health care initiatives.
"The survey shows a strong and growing interest in initiatives designed to build healthier workforces and keep health care costs under control," Natchek stated. "Public employers are stepping up their existing efforts, and many municipalities and counties are looking to add wellness or disease management initiatives for the first time."
Voluntary Benefits Offered By Majority of Public Employers to Increase Employee Choice
The majority, 86% of the public employers surveyed, currently offer or are planning to offer voluntary benefits. Public employers report using voluntary (employee-paid) benefit plans in order to expand the breadth and depth of employee choice (73%), increase employee morale, loyalty and productivity (61%) and fill gaps in employer-sponsored benefits (55%).
The most common voluntary benefits offered by these employers are: term life insurance (64%), life insurance coverage for dependents (57%), dental insurance (55%), long-term disability (52%), vision insurance (52%), and long-term care insurance (49%). Seventeen percent of the public employers surveyed plan to increase their voluntary benefit offerings within the next two years.
Over half of employers, 55%, believe that voluntary benefits are a win-win supplement to an organization’s benefit package, and 52% think voluntary benefits are a good way to promote individual responsibility and accountability. Nearly three in five public employers (58%) predict that voluntary benefit products will grow in popularity if more employers reduce employer-sponsored coverage.
About The Survey
Trends in Public Employee Plans, Survey Results 2010 wasconducted by the International Foundation of Employee Benefit Plans in January 2010. The study was cosponsored by the State and Local Government Benefits Association (SALGBA). The survey results include responses from 569 individuals in the United States representing municipalities, counties/districts, states, educational institutions/education-related organizations and other public entities. Those asked to participate in the survey were (1) public employer representatives in the International Foundation’s database, (2) public sector members of the International Society of Certified Employee Benefit Specialist (ISCEBS) and (3) members of SALGBA.Trends in Public Employee Plans, Survey Results 2010 (Item #6863E) is published by the International Foundation of Employee Benefit Plans. The 29-page survey costs $50 and is free to International Foundation members. To order visit www.ifebp.org/bookstore or contact the Foundation Bookstore at firstname.lastname@example.org or (888) 334-3327, option 4.
The International Foundation of Employee Benefit Plans i
s a nonprofit organization, dedicated to being a leading objective and independent global source of employee benefits, compensation, and financial literacy education and information. Total membership includes 36,000 individuals resenting 4,800 multiemployer trust funds, corporations, public employer groups and professional advisory firms throughout the United States and Canada.
The State and Local Government Benefits Association (SALGBA)
is the premier organization for public sector benefits professionals and has more than 150 local jurisdictions and over 375 members in 48 states.