Large Employers Increase Focus on Workers’ Health and Well-Being

Large employers are integrating employees’ health and well-being into their overall workforce strategy, new data show.

The Business Group on Health’s 2023 Large Employers’ Health Care Strategy and Plan Design Survey found that 65% of large plan sponsor respondents said the role of health and well-being is integral to their workforce strategy, compared with 42% in 2021 and 45% in 2020.  

The survey asked employers whether they viewed their company’s health and well-being strategy as integral to, a consideration in or separate from their workforce strategy.

“We’ve seen employers really take a more strategic view to health and well-being and their investments in that for the long term,” Ellen Kelsay, president and CEO of Business Group on Health, said at a press briefing on the results. “Certainly, the pandemic exacerbated and magnified those efforts, but we don’t think that this jump is notable solely for the pandemic reason, and expect to see it continue to stay at these levels.”

The survey found that 32% of employers view health and well-being as a consideration in their workforce strategy in 2022, compared with 45% in 2021 and 49% in 2020. Additionally, only 3% view health and well-being as separate from workforce strategy, compared with 13% in 2021 and 6% in 2020. Further back, in 2018, 20% of employers viewed health and well-being as separate from workforce strategy, according to the Business Group on Health.   

The COVID-19 pandemic likely affected employers’ efforts to support their employees’ health and well-being, but large plan sponsors are also integrating these efforts into workforce strategy to attract and retain talent in a tight labor market, Kelsay noted.

Employers view investing in employee health and well-being as “part and parcel to organizational performance, driving a healthier workforce and improved performance, engagement and overall business outcomes,” she said.

Expected COVID-19 Effects

The Business Group’s research found that employers expect there will be ongoing effects from COVID-19 on employer-provided health care. Since the onset of the pandemic, employers have experienced the impacts of long-term mental health issues and the need for increased medical services because of delayed care during the pandemic, data show.

The research found that 44% of employers are currently seeing the impact of mental health issues—
categories included depression, anxiety and substance abuse disorders resulting from the pandemic—while 44% anticipate seeing an impact, 4% do not anticipate an effect and 8% didn’t know. (The survey notes that because of rounding, percentages may not add up to 100%.)

In addition, employers are expecting an increase in the need for medical services due to delayed care; 43% of plan sponsors are already seeing an impact from the delay, while 39% anticipate seeing an effect and 11% do not expect an effect. Meanwhile, increased disability claims due to long COVID-19 are affecting 21% of employers, and an additional 24% expect an impact.  

Health Care Costs

The Business Group survey also found that large employers expect median health care costs to rise 6% after plan design changes in 2023, compared with the 5% projected for 2022.

Employers’ median health care costs were flat from 2019 to 2020, “which was quite an anomaly and stood out with us at the time but was probably understandable in the context of a pandemic,” Kelsay said. The median cost increase in 2021, the last year for which data is available, was 8.2%, which Kelsay called a “boomerang” from the previous years. 

“Employers are projecting a return to more normal or historical trend rates in 2022 and 2023,” Kelsay said.  

The Business Group on Health survey was conducted in June and July, with 135 large employers representing 18.3 million U.S. employees.