Health Insurance Critical for Retaining Employees

Faced with rising health care costs, many employers are considering alternatives to employer-sponsored health insurance—or even possibly discontinuing health care coverage for part-time workers or retirees, according to Accenture.

More than three quarters (76%) of respondents to an Accenture survey of 2,709 employees view health insurance as a vital reason for continuing to work at their current employer, and 94% are confident their employer will continue to offer health coverage. If they did lose their insurance, nearly one-third (31%) say they would leave their employer within 12 months, with about half of those (15%) saying they would quit immediately.

Nearly two-thirds (64%) say the absence of health insurance would prompt employee dissatisfaction, and nearly one-third (32%) say they would be less motivated to work hard at their jobs. Twenty-one percent believe losing employer-sponsored health care would lead to increased absenteeism. Accenture estimates that for a company with 1,000 employees who earn an average of $50,000, turnover costs could top $3 million in the first year alone.

“When exploring alternatives to employee health benefits, employers must carefully consider whether the health-insurance costs savings outweigh the projected impact to turnover and productivity losses,” says Rich Birhanzel, managing director for Accenture Health Administration Services. “When it comes to employee satisfaction, our findings show that maintaining a relationship with employees may be just as important to companies, if not more important, than the cost of providing those employees with health insurance.”

More information about the survey is available here.