The Healthcare Trends Institute, an educational platform focused on the rapidly changing healthcare benefits industry, conducted its fourth annual employer benefits study. The national survey went to over 250 human resources executives, benefit specialists and other benefit decision makers from organizations ranging in employee size from less than 50 to over 2,500. The quality and cost of healthcare is on every employer’s mind. The CMS has potential healthcare spending reaching $4.2 trillion by 2020. With our nation in a state of transition right now, there are some relevant considerations employers are facing as they look to transform the inevitable cost curve ahead and meet yearly organizational healthcare cost containment goals. The Survey formed the basis for the 2016 Healthcare Benefits trends report on the following topics: CURRENT HEALTHCARE BENEFIT BENEFITS: Identifies the most widely implemented health plan and benefit strategies employers are relying on to control costs, administer a wide-range of employee benefits and remain compliant in an ever-demanding regulatory environment. Use of and Interest in Defined Contribution Plans, Benefits Redesign, and Employee Communication: Examines the awareness by organizations of defined contribution plans, their advancement in retooling benefit offerings, and commitment to communication efforts that educate and engage employees. HEALTHCARE BENEFIT TRENDS – LOOKING FORWARD: Recognizes new market trends and approaches employers are considering to meet the needs of multi-generational, diverse employee populations.

1. B E N C H M A R K S T U D Y
2017
Healthcare
Benefits Trends
healthcaretrendsinstitute.org

2. 2
2017HEALTHCAREBENEFITSTRENDS
Background
The Healthcare Trends Institute, an educational platform focused
on the rapidly changing healthcare benefits industry, conducted its fourth
annual employer benefits study. The national survey went to over 250 human
resources executives, benefit specialists and other benefit decision makers
from organizations ranging in employee size from less than 50 to over 2,500.
The quality and cost of healthcare is on every employer’s mind. The CMS
has potential healthcare spending reaching $4.2 trillion by 2020. With our
nation in a state of transition right now, there are some relevant considerations
employers are facing as they look to transform the inevitable cost curve ahead
and meet yearly organizational healthcare cost containment goals.
The Survey formed the basis for the 2016 Healthcare Benefits trends report
on the following topics:
CURRENT HEALTHCARE BENEFIT BENEFITS:
Identifies the most widely implemented health plan and benefit
strategies employers are relying on to control costs, administer a wide-range
of employee benefits and remain compliant in an ever-demanding
regulatory environment.
Use of and Interest in Defined Contribution Plans, Benefits
Redesign, and Employee Communication: Examines the awareness by
organizations of defined contribution plans, their advancement in retooling
benefit offerings, and commitment to communication efforts that educate
and engage employees.
HEALTHCARE BENEFIT TRENDS – LOOKING FORWARD:
Recognizes new market trends and approaches employers are
consideringtomeettheneedsofmulti-generational,diverseemployeepopulations.

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2017HEALTHCAREBENEFITSTRENDS
Study Highlights
• Over half the companies reported offering HDHPs this year, up from 39% last
year and 28% in 2013.
• Employers show and increased interest in HSAs, HRAs, and FSAs indicating
that at least half of their employees are enrolled in an account-based
health account.
• Retaining and attracting quality employees remains the most important health
benefit outcome according to three quarters of employers.
• For the fourth straight year, approximately half of employers choose insurance
brokers as their number one partner they depend on to help learn about new
health benefits.
• Over 60% of employers agree with the need for tools to identify and compare
trends around employee health account spending moving forward.

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Throughout 2016 organizations remain committed to providing a standard suite of benefits.
Preferred Provider Plans were the most offered health coverage option at 70 percent. Additionally, employers
have begun to make the switch to high deductible health plans (53%) with health savings accounts (59%) and
away from Health Maintenance Organizations (37%).
Wellness (37%) and mental health programs (38%) continue to be of importance to workforce
management. These efforts seem imperative when considering statistics from a 2016 Mental Health
Foundation report that revealed the damaging effect that poor employee wellbeing is having on employees
and their companies, as one in four workers have considered resigning due to stress and one in five take a day
off work due to stress.
Organizations need to remain aware of the need to keep their workforce physically fit and promote
wellbeing through stress management. Effective employee benefit programs will move toward targeting
physical, mental and emotional dimensions to produce lasting results for employees and employers alike.
What employee health benefits does your
company currently offer?

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2017HEALTHCAREBENEFITSTRENDS
Findings:
The average number of medical plans being offered remained at three or more in 2016. About 41
percent of employers are still providing several coverage options. As noted in this year’s survey findings the
top three health plan types offered are PPOs, followed by HDHPs and finally HMOs. While consistent with
last year, this indicates a gradual move toward offering HDHPs as opposed to adopting a full-replacement
HDHP strategy.
How many different group health insurance
plan options do you give employees?
None at this time - 6.9%
1 - 29.7%
2 - 21.7%
3 or more - 41.7%

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Employee benefit communication continues to evolve as companies must work to reach several
generations of employees throughout the year. The majority of respondents are relying on email (77%) as at
least one way to reach employees. However, approximately half of companies are also actively using multiple
methods of communication such as face-to-face meetings (51%), print (49%), internal websites (49%), and
insurance advisor meetings (41%) to reach employees in their preferred communication styles.
Seeing as Millennials now makeup the majority of the workforce, organizations will need to make
a clear investment in creating digital communications that can be accessed 24/7. This will be a rising trend
as this generation grew up with laptops and cellphones. They are accustomed to getting text reminders about
everything from an upcoming doctor visit to the delivery of a package. Employers need to send similar
benefit alerts and messages to employees using a text-messaging platform.
How do you currently communicate to
employees about their health benefits?

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Employer confidence is strong that they are effectively engaging
employees about their benefits package. Approximately 37% of respondents
feel confident that they are communicating well with employees, while
another 50% believe they are very effective in their communication
approach with workers.
A recent benefits communication study by the International
Foundation of Employee Benefits (IFEB) suggests that companies continue to
refine their benefit communications to include these top five best producing
strategies: Personalizing communication materials, communicating by
lifestages, year-round communication, customizing to multiple generations and
communicating in multiple languages. Effort in these areas should yield results
that include information being read and understood by their workforce.
How effective do you feel your
communication approach is in engaging
your employees to make educational
decisions about their health benefits ?
50% 37% 7.4% 5.6%
Very Effective
Confident
Ineffective
Not Effective

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Growth in account-based plans is increasing. These plans typically offer the greatest savings and
are the lowest-cost option for employees in terms of their paycheck deduction. Surveyed employers reported
that a little over 50 percent of their employees are enrolled in an HSA, HRA or FSA in 2016.
As HDHP growth continues it should be expected that participation in account-based options does
as well. Companies have had to rethink their benefit offerings to save on costs while providing coverage that
helps create greater employee involvement. Employers may move toward contributing to HSAs to encourage
participation and ease an employee’s transition to the consumer directed health plan environment.
The time for FSAs has also firmly arrived. According to PwC’s 2016 Employee Financial Wellness
Survey results each lifestage is demonstrating a growing need for utilization of this benefit. More than one
in five employees provide financial support or care for parents or in-laws. Additionally, 55 percent of Gen
X employees are paying dependent care expenses and among Millennials, 67% are paying dependent care
expenses. Employers need to emphasize the tax advantages of these accounts and the carry-over option
if they offer it to entice employee participation.
What percentage of your employees are
enrolled in a Health Savings Account,
Flexible Spending Account and/or a Health
Reimbursement Account?
51.5%

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2017HEALTHCAREBENEFITSTRENDS
Findings:
With our nation in a state of transition now there are some relevant considerations employers
must face as they look to transform the inevitable cost curve ahead. The top three solutions offered by
organizations are to increase employee cost sharing (20%), increase employee healthcare engagement
(22%) and enhance efforts related to wellness and health management programs (18%) to control future
healthcare costs. With the U.S. Centers for Medicare and Medicaid anticipating healthcare spending to
reach $4.2 trillion by 2020, employers will have their work cut out for them.
With the new administration and uncertainty
of healthcare reform, do you plan to make
any of the following to your employee
benefits package?

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Today’s employee benefits must satisfy a wide-range of workforce needs. Many workplaces are
comprised of multigenerational, diverse employee populations that require a wider variety of innovated
benefits than in years past. Companies recognize that their benefit offerings need to help retain and
attract quality employees (75%), improve employee morale and satisfaction (68%), and improve
employee health (67%).
The IFEB Employee Benefits Survey 2016 benchmarking data also depicts a workforce that
ranks employee stress levels higher and higher year-after-year. Companies need to recognize the need
for a modern approach to their offerings, one that accurately reflects and addresses the new
demographics of organizations and the variety of stressors in employees’ daily lives.
Which of the following are important
outcomes to your health benefits offerings?

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Organizations understand they need to devote the time and
resources necessary to making their benefit offerings competitive and
a good fit for their culture with over 84% of employers agreeing that the
quality of their benefits package is important.
Today’s robust hiring market means companies are refocusing their
efforts on creating attractive compensation packages, with a rising trend
toward investing more in benefits. Currently, benefits now comprise a large
percentage of total employee compensation (up to 60% for some companies),
according to the IFEB Employee Benefits Survey 2016. A complete benefits
package will help demonstrate an organization’s commitment to the wellbeing
of their employees and increase worker satisfaction and overall job
satisfaction, which leads to a positive reputation in the business world.
How strongly do you agree or disagree
with the following statement:
“The quality of a benefits package
impacts the reputation of my company”?
7.8
56% 28% 11.8% 4.2%
Strongly Agree
Agree
Disagree
Strongly Disagree

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2017HEALTHCAREBENEFITSTRENDS
Findings:
In a defined contribution plan (DCP) employers give employees a set amount of money to
purchase the benefits of their choice. DCPs remain a relatively new concept for active employees. This
correlates to this year’s survey finding of 36 percent of employers reporting some uncertainty about this
approach. Of those employers familiar with DCPs they believe they can help employees understand the
value of their benefits (27%) and make more cost-conscious benefit decisions (24%).
Current nationwide benefit surveys report about 12 percent of employers are using DCPs and
36% are considering it for 2017. The approach encourages employees to “benefit right-size” by often
implementing robust decision support tools that can ease the transition to HDHPs or high performing
network plans.
Do you think offering a defined
contribution plan (DCP) would:

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Employers overwhelmingly recognize (69%) that a well-executed benefits strategy must have
plan and cost comparison tools to help engage and educate employees. Ease of use for employees is also
important so tools like online access (58%) and mobile applications (40%) are desired to ensure successful
benefit enrollment and participation.
What employee features do you feel
are most important when designing
a benefit offering?

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Almost half of all employers are looking to their insurance broker to help with benefit information
and guidance, up from 40% last year and X percent in 2014. Complexity around the ACA has grown over
the last several years as well as employers’ needs to contain healthcare costs. Companies are engaging their
broker for help with compliance efforts, voluntary benefit options, wellness and healthy program designs,
and technology support to meet their organizational and employee needs.
Brokers face an evolving benefits landscape with changes in regulations, advances in technology,
shifts is employee demographics and most definitely in employer expectations. To fully address employer
needs, brokers must continue to expand their capabilities in every direction to deliver on healthcare cost
management and a competitive employee benefits package.
What type of organization do you
depend on to help you learn about new
health benefit designs and distribution
models, such as Consumer Directed
Health Plans, Defined Contribution Plans
(DCPs) and private exchanges?

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2017HEALTHCAREBENEFITSTRENDS
Findings:
Keeping healthcare costs in check for employees remains a priority for employers (29%) as they’ve
considered their benefit offerings over the past couple of years. As they’ve looked toward new approaches
of employee empowerment, at least a quarter of organizations have begun to invest in employee education
(25%) and healthy/wellness incentives (27%).
Organizations looking to make employees their own best care managers, understand it requires
creating an informed healthcare shopper and providing an environment that guides positive employee
behavior and promotes engagement.
According to the National Business Group on Health and Fidelity Investment 2016 Survey, incentives
have the power to help employees achieve positive wellness results. And industry benefit specialists also
recommend designing programs with flexibility of choice to earn wellness incentives rather than prescribed
actions. Treating employee empowerment as a long-term strategy through education, engagement and
incentives will support employees in meeting their health and wellness goals year-over-year.
In the past 2 years, how has your
approach to designing benefits change?

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2017HEALTHCAREBENEFITSTRENDS
Less than 50 - 28.6%
51-100 - 13.1%
101-1000 - 33.7%
1001-2500 - 6.9%
2501+ - 17.7%
Approximately how many full-time
employees are in your company/
organization?
What is your role in the organization?
Human Resources - 32%
Owner/CEO/President - 12%
CFO - 2.9%
Benefits management/
administration - 24%

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2017HEALTHCAREBENEFITSTRENDS
Survey Summary/Conclusion
• Companies appear to be making some tweaks to benefit offerings, but are
consistently still offering PPO coverage while making the gradual move to
HDHPs. They remained committed to providing prescription drug, dental
and vision options. Due to their relatively low cost these plans offer
employers a very affordable way to positively impact employees’ overall
health and productivity.
• Communication efforts surrounding benefits are strong among employer
groups. They understand the importance of creating health literate employees
by reaching them through multiple platforms of communication. Employers
need to remain compelled over the next few years to add mobile applications
to their communication channels in an effort to reach more millennials, who
are the becoming the majority of their workforce.
• Account-based plans such as HSAs, HRAs, and FSAs continue to grow in
popularity. A health trend that is expected to bloom in the years ahead. For
instance, a new type of health account “a qualified small employer health
reimbursement arrangement” was part of the newly-signed 21st Century
Cures Act. A tool that may be used more in the future to expand group coverage.
• Insurance brokers have a prevalent role in helping employers shape their
future health plan and benefit offerings. Organizations are interested in
forming partnerships with their brokers, relying on them to be knowledge
experts on new compliance mandates, plan designs, health and wellbeing
solutions, and pharmacy strategies.
• Companies are looking to increase the use of tools and data in their benefit
decision-making process. Integrating data to see patterns as to what’s working,
what isn’t and where the gaps are will help employers provide relevant
options and more personalized health and wellbeing benefits to increase
employee satisfaction.

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2017HEALTHCAREBENEFITSTRENDS
About the Healthcare
Trends Institute
Healthcare Trends Institute is an educational platform to help employers,
third-party administrators, health plans, brokers, banks, payroll providers,
consumers, and other stakeholders keep up with the rapidly changing healthcare
benefits industry. It covers a range of topics related to the administration and
management of healthcare benefits. To ensure all content and programs achieve
the highest level of quality and relevancy, the Institute is guided by an Editorial
Advisory Board comprised of subject-matter experts that represent diverse
aspects and perspectives within the healthcare benefits industry.
More information is available at www.healthcaretrendsinstitute.org
Tiffany Wirth, Executive Director
Healthcare Trends Institute
700 26th Avenue E
West Fargo, ND 58078
P 701.499.7215
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