Article

How COVID Might Forever Change Benefit Plans

How COVID Might Forever Change Benefit Plans

Companies of all sizes are likely to see lots of permanent changes. In 2021, what is considered a great benefits package is very different from what was considered a great benefits package 25 years ago.  Now with the pandemic disrupting businesses, employers recognize even more that benefit plans need to adapt to compete for and retain the best talent.

This article examines a few trends to watch this year and next.

July 10, 2021
How COVID Might Forever Change Benefit Plans
Important Disclosure: Content on our website and in our newsletters is for informational purposes only. The information provided may (or may not) directly apply to your situation. We recommend that readers work directly with a professional advisor when making decisions in the context of their specific situation.

Job seekers and HR executives have known for decades that it’s not just about salaries – employee benefits programs are great recruiting and retention tools. But what is considered a great benefits package in 2021 is very different from what was considered a great benefits package 25 years ago.

In fact, with the pandemic disrupting businesses for most of last year and into this year, employers recognize that benefit plans need to adapt even further in order to compete for and retain the best talent.

Let’s examine a few trends to watch this year and next.

Health Plans Will Change

The Society for Human Resource Management reported that health insurance premiums have increased by a whopping 54% over the past decade. But employees have eaten most of the increase as they have been hit with about 70% of the increase in premiums. Given how disruptive COVID was to the employment landscape and incomes – plus the disruption to businesses – it is reasonable to assume that both employees and employers cannot afford rising premiums again this year.

On-Site Clinics

So where can healthcare costs be reduced? By contracting directly with service providers rather than going through an intermediary. In other words, employers that have the ability to contract directly with service providers might do so versus going through multiple intermediaries.

For example, the concept of setting up a primary care clinic on site might make economic sense for larger employers, while providing convenience for employees.

Telehealth

COVID-19 forced individuals to utilize telehealth benefits for routine checkups as well as for more specialized care. And while most will say it took some getting used to, most might also admit that the convenience and treatment were both good.

Sure, it was not the same as meeting face to face with your healthcare provider, but telehealth did eliminate travel time and waiting times in doctors’ offices. And it was more efficient for care providers too.

As COVID recedes from our communities, telehealth will not.

Customized Plans

Employees have recognized that allowing employees to customize their benefits can actually reduce costs, while allowing employees to feel special.

For example, an employer might offer everyone a basic health package along with a set amount of time off, but then allow employees to add options from a menu of benefits so that their overall package is tailored to their specific needs. These options might include pet insurance or access to legal services, for example. And employees are more likely to help cover the costs of  a customized package versus a one-size-fits-all plan.

Mental Health

No doubt you have seen news reports of the increase in mental health challenges given the shutdowns to our nation’s schools and businesses. And the impact to our collective mental health will not simply disappear as more of us get vaccinated. So employers know that helping employees reduce stress will help their bottom line.

Going forward, you can expect to see more Employee Assistance Programs that encourage periodic mental health checkups.

Other content you may like

  • May Student of the Market

    May 27, 2025
    In 2025, diversification helps with stock market volatility, and April saw the volatility index rise to its highest point since the pandemic. We also look at alternative strategies, bond performance, and scenarios surrounding interest rate cuts later in the year.
    Read this Article
  • Keeping Sight of Your Personal Priorities

    Keep Sight of Personal Priorities

    July 11, 2024
    As a business owner, you can often lose sight of your personal priorities and goals as you invest the much-needed time and energy to grow and develop your company. Here are some ideas that might help you keep sight of your original hopes of achieving financial independence by owning your own business.
    Read this Article
  • A Positive Start to the Year for Stocks

    A Positive Start to the Year for Stocks

    June 23, 2023
    Looking at stats from January through May, it’s good to see a positive start to the year for U.S. stocks. This market overview also looks at the growth heavy U.S. large cap stock index and charts the hidden risk in Growth vs. Value. Included is a current and historical look at how the Fed funds rate affects core bonds, short term bonds, and performance strategies with a potential Fed Reserve pause.
    Read this Article
  • Tips to Shape Up Your Long Game

    Tips to Shape Up Your Long Game

    April 11, 2023
    If you start a fitness program to stay in shape then drop out, you never give yourself a chance to become physically fit. It’s much the same with fiscal conditioning. It’s important to stick to a regular program of sound financial practices to achieve fiscal fitness and the financial independence that goes with it. A plan will help you reach your goals, in the long-run.
    Read this Article
  • The link you have selected is located on another server. The linked site contains information that has been created, published, maintained, or otherwise posted by institutions or organizations independent of this organization. We do not endorse, approve, certify, or control any linked websites, their sponsors, or any of their policies, activities, products, or services. We do not assume responsibility for the accuracy, completeness, or timeliness of the information contained therein. Visitors to any linked websites should not use or rely on the information contained therein until they have consulted with an independent financial professional. Please click “Continue to Link” to leave this website and proceed to the selected site.
    phone-handset