Employers are increasingly adding wellness programs like seasonal flu shots, weekly yoga classes and employee assistance programs to support employees’ physical and emotional health. The inherent value of this type of offering is difficult to argue, however there’s a large aspect of wellness that’s going unaddressed: employee financial health.
Looking at wellness with a wider lens, consider not only physical health as it would typically be perceived, but also the connectedness and impact of stress and financial circumstances on individuals’ overall well-being. A study by the American Psychological Association found that 72% of adults feel stressed about money at least some of the time, and 22% experience “extreme stress” about money. Understanding that financial stress is prominent, now recognize the possible effects of that strain, including anxiety, depression, lack of motivation, fatigue and irritability — employers would do well to protect their employees against stress related to personal finances.
The traditional employer contribution to employees’ financial health is direct compensation, with some adding 401(k) programs, annual bonuses and raises as incentives for retention and stability. However, employers need to recognize that compensation is only half of the picture. It doesn’t prepare workers for the impact of unanticipated expenses and the resulting stress.
Growing cost burden
Healthcare coverage is one obvious example. Now that out-of-pocket healthcare costs account for 9.6% of median income, healthcare expenses are playing a more prominent role in the financial well-being of Americans. With healthcare costs continuing to rise, and employers and their staff being saddled with an increasingly large percentage of overall costs, perhaps it is time that employers expand their definition of and approach to wellness to better address healthcare finance management.
Recognizing the relationship between financial, physical and emotional health will help employers develop and foster more comprehensive wellness programs. Those involved in employee benefits should prioritize adding tools focused on financial, and by extension physical, health and well-being.
A major issue directly relating to healthcare finances is medical billing errors and overcharging. In fact, it’s estimated that 90% of medical bills potentially contain errors and or overcharges. With opportunities to save so abundant, it is not surprising how many employees report frustration. These issues can easily spill over to HR departments and benefit managers, as many will inherently look to their benefits provider to help resolve issues around medical billing and claims. Educating employees and offering services that help contain costs can mitigate the stress involved in understanding and negotiating a medical bill.
Employers can reduce employee stress related to finances in many ways, but it starts with revisiting overall understanding of wellness. Consider a hybrid approach to financial health and wellness benefits. Continue to offer compensation and healthcare options and supplement with access to financial. It’s clear that financial stress affects the majority of the American public, and introducing programs to alleviate that stress can set the foundation for a happier, healthier and more productive workforce.