How Communication Can Help Employees Navigate Rising Healthcare Costs

The rising cost of medical benefits is a concern for many employers who want to provide affordable coverage for their employees. Unfortunately, costs could increase significantly for 2024 renewals, according to industry surveys and reports. Employers expect plan costs to grow between 6.8% and 7.3% in 2024. As a result, healthcare plans could see an average cost of $15,000 per employee.

The challenging labor market has pushed many employers to absorb rising costs instead of increasing employee premiums to keep their workforce satisfied. However, workers will likely still face higher healthcare expenses as medical costs continue to rise.

The key is to remember that even minor cost increases for employees can cause significant stress for those with lower salaries and financial pressures at home. Acknowledging this is crucial for effectively communicating about rising healthcare costs.

How communication plays a role

Providing information related to costs is critical. Studies have consistently shown that open communication builds trust with staff and strengthens employee loyalty.

The following four tips can help when communicating with employees about rising healthcare costs.

Tip #1: Establish key messages that are clear and simple

Words have power. The way you phrase a message can create calm or cause fear and confusion.

Having clear, simple, and consistent messaging increases the likelihood that your information will be understood and accepted. Easy-to-understand messages that can be repeated also help managers distribute important healthcare and benefits information to the entire workforce.

Messaging should highlight what you are doing to offset higher costs. For example, your base medical plan may now offer a narrower network, but co-pays were lowered. Another example could be added perks, such as reimbursements for gym memberships and health trackers.

These simple, key messages help employers explain what they are doing to address rising healthcare costs concerns and that they are mindful of the financial burden it can cause. In turn, you are more likely to have employee buy-in for any changes while building loyalty and trust with your workforce.

Tip #2: Communicate changes to employees

When benefits change, you must communicate details to employees. Failing to do so may result in employees paying for expensive and, in some cases, unnecessary care. For example, employees may unknowingly go out of network to receive care, causing increased costs.

You should acknowledge if changes to benefits plans result in higher costs or fewer options for employees. Explain that your efforts are intended to manage costs and provide a benefits program that meets employees’ needs now and in the future.

Yet when it comes to bad news, some executives are leery of communicating. This is partially due to a fear of pushback. Keep in mind that when information is vague or not shared, people fill in the gaps themselves, which quickly results in speculation and misinformation.

It’s best to be honest with employees. They appreciate transparency. Plus, by delivering the message yourself in an open and caring manner, you control the narrative and can help keep rumors at bay.

Another key part of communicating benefit changes is ensuring that all employees receive the information in a timely manner. This ensures fairness across the company and avoids potential misunderstandings or conflicts.

Tip #3: Select appropriate communication channels

Every workplace is different, so selecting communication channels that are engaging and relevant to your workforce is important.

In-person methods such as town hall meetings, one-on-one sessions, and team huddles can provide a more personalized and interactive approach to discussing healthcare costs and benefit changes. These face-to-face communications can help ensure that employees fully understand the implications of any changes and can ask questions in a supportive environment.

You should also leverage technology to communicate with employees about changes to healthcare costs, benefits, enrollment deadlines, and more. This includes digital tools such as intranet sites, mobile apps, Zoom meetings, and email newsletters.

Physical mailers and informational brochures can be used to supplement communication efforts. Sending out printed materials with clear and concise explanations of healthcare changes can provide employees with tangible resources they can refer to at any time, reinforcing the information communicated through digital and in-person channels.

Tip #4: Educate employees about rising healthcare costs

Employers can educate employees on the current state of the health insurance industry and how to effectively use their health plans to avoid unnecessary or high-cost care. By focusing on educating employees about any changes and rising costs, you help employees understand their options better.

Employers can also give staff a breakdown of total healthcare premiums and the portions paid by each party. This can help employees understand how medical costs impact a company’s bottom line and highlight the total value of benefits provided to employees.

Additionally, employers can provide tools to help employees make the most cost-effective healthcare decisions. This can include online resources that enable employees to compare the costs and quality of different healthcare providers or services.

Clear, consistent communication about healthcare costs helps employees understand the impact on their wallets and how they can navigate changes to their benefits plans. Transparency builds trust and strengthens employee loyalty, ultimately contributing to a more engaged and productive workforce.

For ideas on how you can control rising healthcare costs, reach out to an experienced employee benefits advisor at The Miller Group.