Respecting Employee Individuality: Starting With Personalized Health Benefits

The challenge for organizations is ensuring their benefits align with what employees value most

In the health and wellness market, consumers increasingly demand individualized products and experiences backed by science. You can start your morning with a vitamin and supplements packet tailored to your needs and ailments, complete with your name on the packaging; followed by a workout tracked by wearable tech that monitors and logs individual health metrics, all while listening to a playlist curated by a music streaming app based on your listening habits.

But what about wellness and health benefits in the workplace? Are employees getting the highly personalized options they receive as consumers? Data shows significant discrepancies between the traditional benefits companies offer and personalized and specific options like mental health benefits that employees want and need. In a PeopleKeep survey of more than 900 employees who work for small to midsize employers, 65% said they value being able to choose their own benefits, but only 36% feel they have a say at their current company. Further, 63% of employees said mental health benefits are important, but only 5% of employers said they offer mental health benefits. 
 
The crux of the issue is that companies can struggle to create a benefits strategy that addresses their employees as individuals—individuals that want benefits that work for their unique situation.
 
Dr. Solange Charas, a human capital expert and adjunct professor at Columbia University and the University of Southern California, said, “Organizations that aren’t actively embracing an employee-centric business model will soon find that their competitive advantage will erode, along with a diminished employer brand and sub-optimal efficiencies,” in a Forbes article by author Glenn Loppis.
 
Investing in employee wellness is a significant step toward an employee-centric business model. When asked what will affect the future workplace, 74% of employees said employee wellbeing is predicted to have the greatest impact on the future workplace. Additionally, 72% of employees rank work-life management benefits and programs among their top five desired benefits to improve wellbeing, according to MetLife’s annual U.S. Employee Benefit Trends Study 2021, Redesigning the Employee Experience: Preparing the Workforce for a Transformed World.
 
Regardless of company size or industry, the physical and mental health of employees and their families impacts employee stress levels and morale, directly impacting the company’s success and bottom line. One GenX female from the PeopleKeep survey remarked, “The older I get, the harder it is to justify not having good benefits. To be honest, poor benefits often translate to a lack of employee appreciation.”  

Employee Recruitment and Retention

Employees have raised their expectations and made them known. The mass of U.S. employees who voluntarily left their jobs in the Great Resignation reached almost 50 million employees last year—and there’s no sign of it slowing. 4.5 million people quit their jobs in March, up from 4.35 million who quit in February, in pursuit of higher salaries and better workplace benefits. 
 
In PeopleKeep’s survey, 82% of employees said that the benefits package an employer offers is an important factor in whether or not applicants accept a job with an organization, while only 66% of employers surveyed think it’s important.
 
In today’s employee-centric market, with increased competition for top talent, employers must redouble their efforts to keep their current employees happy and entice new employees to join their organization. Expanding and tailoring benefits is one key lever in attracting and retaining employees. The challenge for organizations is ensuring their benefits align with what employees value. 
 
Here are two solutions that businesses can offer their employees for increased benefits personalization and flexibility: 

Health Reimbursement Arrangement (HRA)

An HRA is an IRS-approved, employer-funded health benefit used to reimburse employees, tax-free, for their healthcare expenses. Employers set a benefit allowance, and employees use their allowance on the qualified medical expense they choose. Employees are stewards of their own health benefits—determining what insurance and expenses make sense for their personal health, budget, and family situation. Employees simply select and purchase the insurance and services they want and then submit the receipt to their employers. Employers then reimburse them for the eligible expenses. 

Wellness Stipends

Employee stipends or perks are another way to empower employees to choose the benefits that are most impactful to them. With a wellness stipend, employees can use their allowance for chiropractic care,  meditation classes, wellness apps or other services and goods that the employer decides to cover. 

Inclusion

The current workforce is more diverse than ever, consisting of varying ethnicities, five generations, and remote, hybrid and field workers.
 
Part two of the PeopleKeep survey found that factors such as gender, age and work environment all influence what benefits an employee values. Most notably, women overwhelmingly value mental health benefits compared to men (70% compared to 49%.) 

On average, females overall value the benefits researched in the PeopleKeep survey more than males. Women perhaps value benefits more because, on average, they earn less than their male counterparts. According to the annual earnings of the employees surveyed, 61% of females earn less than $60,000, while only 37% of males earn less than $60,000. This income disparity could lead females to utilize their benefits better and place greater value on money-saving resources than higher-paid male employees.
 
Companies that broaden their health benefits options foster inclusivity—addressing the unique challenges and matching the needs of their employees regardless of demographic. Traditional employee benefits aren’t entirely inclusive of employees’ individual needs. Personalized health benefits allow employees to use their benefits in ways that can differ based on gender, sexual orientation, race and ethnicity, location and age.
 
In conclusion, the ability for companies to retain and satisfy employees depends on acknowledging identity and individuality—in other words—genuinely caring about the health and wellbeing of each employee both in and outside the workplace and tailoring their benefits to match. 

Victoria Glickman Hodgkins is the Chief Executive Officer at PeopleKeep., a provider of award-winning health reimbursement arrangement (HRA) and wellness stipend administration software for small to medium organizations.   Connect Victoria Glickman Hodgkins