Employers look to employees to lower health care costs

<p> A new survey suggests employers are looking to employees to help cut rising health care costs, some offering incentives to encourage healthier behavior, or implementing penalties if goals are not met. &nbsp;</p> <p> According to the survey by global human resource consulting company Aon Hewitt, employers&rsquo; top health care goals for this year are improving <a href="http://www.benefitspro.com/2011/06/01/improving-employee-health">employee health habits</a>, lowering health care costs, decreasing worker health risk, increasing employee awareness of health issues and improving participation in health improvement and disease management programs.</p> <p> However, 56 percent of employers say that motivating employees to change unhealthy behaviors will be their biggest challenge to these <a href="http://www.benefitspro.com/2011/06/01/improving-employee-health">health care goals</a>. About a quarter are concerned about employees&rsquo; reluctance to change and the unpredictability of costs. Twenty-two percent said regulations and compliance issues were a challenge, and about the same named the aging workforce as a concern.</p> <p> &ldquo;Despite reform, organizations still face rising costs and worsening population health,&rdquo; said John Zern, Americas Health &amp; Benefits Practice leader with Aon Hewitt.&nbsp; &ldquo;It&rsquo;s clear that traditional annual trend mitigation tactics alone won&rsquo;t work. As a result, leading employers are implementing a &lsquo;house money, house rules&rsquo; environment, using a mix of incentives, penalties and targeted messaging to reward healthy behaviors.&rdquo;</p> <p> <strong>Many employers not prepared for increases</strong></p> <p> The survey also revealed that 42 percent of organizations have not yet budgeted for future health care trend increases. Thirty percent have budgeted an annual increase between 4 percent and 7 percent from 2011 to 2015, and 22 percent have budgeted an increase of more than 8 percent during that time.</p> <p> &ldquo;Employers are spending millions of dollars annually on health care, and yet many report they do not have a specific plan for how best to manage that investment,&quot; notes Jim Winkler, Large Employer Segment leader in the Health &amp; Benefits Practice with Aon Hewitt. &quot;Given the risks and opportunities presented by health care reform, it is imperative that employers develop a written strategy for controlling cost and improving health.&quot;</p> <p> <strong>Rewards and penalties</strong></p> <p> Twenty-two percent of employers say they will have reward programs in place by the end of the year for those who achieve specific health outcomes, and 10 percent will develop programs to penalize those with unhealthy outcomes, according to the survey. Within five years, 64 percent of organizations said they will add programs that reward for good health, and 46 percent said they will add programs that penalize for unhealthy outcomes.&nbsp;</p>