Employers Look to Enhance Healthcare and Wellbeing Programs in Response to COVID-19

Companies are making enhancements to their health care, wellbeing and leave programs, according to a new Willis Towers Watson survey examining the business impact of COVID-19 on health benefits. The survey, conducted from April 20 – 23, found that nearly half of respondents (47%) are enhancing health care benefits, 45% are broadening wellbeing programs, and 33% plan to make changes to paid time off (PTO) or vacation programs. And while some companies are reducing costs in other ways — furloughs, pay cuts and reductions in 401(k) matching contributions — many are preserving wellbeing plans at a time when employees are facing significant challenges.

Source: WTW | Published on May 8, 2020

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“Although most employers anticipate a significant negative impact from COVID-19, many are taking steps to protect the health and wellbeing of their employees,” said Regina Ihrke, senior director and wellbeing leader, North America, Willis Towers Watson. “Employers are doing what they can to support their workers through this difficult time. The pandemic has led to high levels of employee anxiety and stress, so employers are making it easier for employees to get help across all aspects of the wellbeing spectrum.”

Supporting physical and emotional health is a top priority for most employers as 64% believe COVID-19 will have a moderate to large impact on employee wellbeing. More than three in four (77%) are offering or expanding access to virtual mental health services. Maintaining physical health is also important with 60% of employers offering new easy-to-implement virtual solutions such as virtual workouts to support employees who work from home. Another 19% are planning or considering these solutions. Half (50%) promote healthy nutrition and weight management for at-home employees, and 25% are planning or considering adding these programs.

The survey found a majority of employers don’t expect their health care benefit costs to rise substantially. Fifty-seven percent of respondents anticipate a small to moderate increase in costs, 24% expect no increase or decrease, and only 3% expect a large increase. A separate Willis Towers Watson actuarial analysis found employer health care benefit costs could fall by as much as 4.5% this year as demand for nonessential medical care has declined during the COVID-19 crisis. Over six in 10 (61%) employers have made or will make changes to their benefit programs over the next six months with two out of five (38%) planning to revise their health care strategies for 2021.

Employers are also prepared to help employees with COVID-19-related costs. Seventy percent have waived telehealth costs, 69% have expanded reimbursements for over-the-counter drug costs through flexible spending accounts or health reimbursement arrangements, and 62% have waived or reduced COVID-19 treatment costs.

When it comes to leave programs, 42% of employers have made or are planning to make changes to PTO, vacation and sick-day programs to enhance employee flexibility and lessen the buildup of accrued days by year-end. To minimize lost days, 24% of employers are planning to increase carryover limits, and 21% are allowing negative balances. Sixteen percent require employees to take PTO or vacation time to reduce year-end buildup, and 22% are planning or considering this requirement. Due to the COVID-19 pandemic, 12% are allowing donation to other employees, and 15% are planning or considering a donation program.

“Leave policies have become incredibly important to those employees juggling new work arrangements and family situations such as children being home from school,” said Rachael McCann, senior director, Health and Benefits, Willis Towers Watson. “Employers recognize that these programs are relatively easy and inexpensive to change and generate a great deal of goodwill. By taking positive actions around health, wellbeing and leave, employers are putting people first. And that’s an investment that’s likely to build employee loyalty, raise engagement and enhance future productivity.”

About the survey

A total of 816 employers participated in the COVID-19 Benefits Survey, which was conducted during the week of April 20, 2020. Respondents employ nearly 12 million workers.