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Employee benefits trends: What brokers can expect in 2023

The COVID-19 lockdowns of 2020 may be fading in our memory, but that year continues to shape the benefits world. Only one of the employee benefits trends we’re projecting for 2023 is directly about the COVID-19 virus (see “Addressing long COVID” below), but all of them are forged from the dramatic, and traumatic, upheaval of 2020.

Supporting family caregivers

The pieces won’t fall into place on their own

With 53 million people in the United States serving as caregivers to loved ones,1 support for this population applies to more of your clients’ workforce than you might realize. And chances are, they’re not getting support—only 8.1% of family caregivers who are employed receive assistance from their employers.2

In helping caregivers, employers also help themselves. The stress and time-based demands of caregiving draw attention away from work—nearly 1 in 4 employed caregivers reported absenteeism or presenteeism related to their caregiving duties within a one-month span.3

What this means for brokers: Highlighting absence solutions, including Family and Medical Leave Act support and mental health services, can help your clients see ways they can support caregiver employees.

Catching up on preventive care

Too many Americans still haven’t caught up on the preventive care they avoided or were unable to get during the COVID-related lockdowns. More than a quarter of the people surveyed in January 2022 said that a procedure had been canceled or delayed in the past year.4 We’re now paying the price for that delay: Patients are seeking treatment for conditions that are more advanced (and more costly to treat) than they would have been if treatment or preventive screenings hadn’t been delayed.5 Cancer in particular has seen an uptick—13% of employers say they’ve seen employees diagnosed with more late-stage cancers compared with before the pandemic.6

And, as with many other health care issues, these delays in care don’t affect everyone equally. Black and Latino patients, lower-income communities,7 older adults,8 and people with disabilities9 have suffered more as a result of deferred care.

What this means for brokers: Preventive care programs are “always on”—which means they might not be getting their due. Talk with your clients about how they can promote preventive care within their workforce. Remind them that it benefits them directly: Healthier employees equals fewer absences. Also, discussing disparities in care can be a critical step toward helping vulnerable populations achieve health equity.

Addressing long COVID

More than 100 million people around the world are dealing with long COVID10—ongoing health problems that continue even after a patient has tested negative, with symptoms including fatigue, brain fog, and chest pains.11

Research suggests that long COVID has led to a 13% reduction in weekly work hours for those with its symptoms in the United States—and that only 55% of workers say that their workplace accommodated people with the condition.

That translates to workplaces hurting their bottom line—35% of survey respondents said that long COVID had harmed their productivity.12 Additionally, people with long COVID said that they had lost an average of $4,308 in salary thanks to a missed promotion or salary bump.

Just as with COVID itself, long COVID appears to strike unequally, disproportionately affecting people who are Hispanic, female, transgender or lacking a high school degree.13

What this means for brokers: One way employers can address long COVID is through employee benefits. Supplemental benefits such as hospital indemnity, critical illness and disability insurance may have benefits to help offset some of the costs. The health equity implications of long COVID are worth highlighting to clients as well.

Figuring out wellness

What is wellness, exactly? In terms of benefits programs, we can loosely define it as endeavors that support healthy lifestyles, mindfulness and some aspects of mental health. But “wellness” is a buzzword, and buzzwords can become ubiquitous—and thus more difficult to delineate from other programs that support health.

Employers are taking notice. The long rise of workplace wellness programs is projected to taper, with expected annual growth of 3.8% from 2020 to 202514—a far cry from the climb of previous years. But that’s not to say that wellness benefits are disappearing. Instead, employers are being more thoughtful about what constitutes wellness.

What this means for brokers: You can help guide employers as they consider what programs are most meaningful to their employees. Look at takeup rates of the wellness programs in your portfolio and ask why certain programs fare better than others. Are there missed opportunities? That might mean doubling down on communication. If programs aren’t living up to what wellness means to this particular workplace, perhaps the programs just aren’t useful. This is the time to partner with decision-makers to ensure that wellness spending is being directed to the programs that maximize value.

Talking to the right people

The Great Resignation—the massive upheaval of employment that saw people quitting their jobs in record numbers in 2021 and 2022—continues to reverberate. One unexpected fallout: Brokers are having more conversations with C-suite decision-makers directly instead of primarily working with human resources departments.15 As benefits continue to rise in costs, executives have more incentive than ever to become more involved.

What this means for brokers: Talking with the C-suite might necessitate a shift in how you communicate, but it doesn’t need to be a complete overhaul. HR professionals may be more laser-focused on the ins and outs of benefits packages. If you’re now also having conversations with people in the C-suite, adjust accordingly. Contextualizing the “why” and ROI behind your packages can help frame conversations that benefit both you and your clients in 2023 and beyond.

Adjusting for inflation

You’re no stranger to the rising costs of health care—a long-term trend that currently shows little signs of abating. But unless you were practicing in 1981,16 you’ve never seen health care costs rise in tandem with inflation, which is exactly what we’re seeing now.

That steep rise, 8.5% at its highest at the time of writing,16 translated to difficult decisions for employees in 2022. Nearly half of employees say that inflation affects their ability to pay for benefits, and 2022’s open enrollment season may reflect that reality.17 The Federal Reserve continues to try to find ways to stem inflation, but households will continue to feel the pinch.

What this means for brokers: The challenge is on to be even more creative with the benefits strategies you propose—say, suggesting switching among carriers, scaling down packages or even eliminating certain benefits that aren’t supporting employees as much as other options. (Remember, employees themselves are feeling the pinch of inflation too, and health care isn’t the place for them to cut back.) You may not be able to do much about the raw costs clients can expect to see, but establishing an ongoing line of communication and education can help prepare them to provide competitive benefits on an increasingly shrinking budget.

2023 can be a year of success. To make Aflac a larger part of your year, contact your Aflac benefits advisor.