7 Things Employers Don't Know About Healthcare Benefits

For 10 years researchers at Metropolitan Life Insurance Company (MetLife) have conducted an annual survey about employee benefits. While much of the survey focuses on benefits in general, the 80-page report is chock full of information that employers probably don't realize, but should consider as they talk to health plans and employees about their healthcare benefit programs.

The survey results confirm that health benefits are "number one on the minds of employees," says Ronald S. Leopold, MD, vice president and national medical director of MetLife U.S. Business. He adds that as the economy improves, employers are turning the corner in terms of how they view benefits. They’re moving from thinking that employees should be happy just to have a job, to seeing benefits as an important tool for attracting and retaining employees.

Leopold says employee attitudes are also shifting. During the bad economy, employees were focused primarily on salary. Now, he says, they are taking a look at their entire compensation package and benefits are coming into sharper view.

The survey results also reveal that when it comes to benefits, employees maintain a level of distrust toward their employer. Leopold says employers need to work harder to avoid miscommunications about benefits. He points to the finding that 33% of employees think employers plan to reduce benefits while only 10% of employers report that they plan to make that move. To avoid that disconnect "employers need to deliver a clear message to employees about the status of benefits."

Among the key findings of the 2011 survey:

1. Younger employees are interested in benefits. Despite all the talk about so-called "young invincibles" being benefit and health insurance skeptics, Gen X and Gen Y employees are looking more seriously at benefits and their interest will "redefine what benefits will mean in the coming decade." They are especially concerned about having protection from the costs of a serious illness that might not be covered by health insurance.
2. Employers don't offer the right benefits. Employees think employers are out of step when it comes to recognizing benefits employees want. Non-medical benefits or so-called voluntary benefit offerings such as long-term care, dental, and vision benefits are important to employees, but only 41% of employers say that voluntary benefits are part of their benefit packages.
3. Employees are willing to pay for benefits. Ten years ago employees expected benefits,  but were less aware of the real cost of those benefits. In today’s economic climate employees are willing to pay more of the costs themselves. Gen Xs and Ys express an especially strong interest in being able to choose from a selection of voluntary benefits that they are willing to pay for on their own.
4. Employees are bracing for benefit cuts. Although 77% of employers report that they intend to maintain their current level of healthcare benefits, employees just don’t buy it. They are worried that a weak economy could cause employers to reduce benefits. However, only 12% of employers say they plan to reduce healthcare coverage benefits while 11% plan to increase those benefits. Still, 30% expect to shift more of those costs to employees.
5. There's a generational view. Employers are beginning to build a generational perspective, aligning benefits for Gen Xers and Yers as well as baby boomers, into their benefits programs but employees think they can do more.
6. Benefits correlate with job satisfaction. Survey results have noted this strong relationship since 2004. According to the survey the correlation drives a universal set of business objectives such as employee attraction, retention and productivity. But before employers get too excited, they should note the next key finding.
7. There's a loyalty gap. Only 42% of employees have a strong sense of loyalty to their employer. That's a seven year low for the MetLife report. Meanwhile, employer loyalty is at a seven year high with 59% of employers reporting a strong sense of loyalty to employees.

MetLife’s 2011 annual survey (PDF) comprised 1,519 interviews with benefits decision-makers; the employee sample comprised 1,412 interviews with full-time employees over age 21.