Do Employees Blame You for Increased Healthcare Costs? [ACA Series]

You may have worried how employees would react how when you realized their healthcare costs would increase (as it did for almost 60 percent of employees since the Affordable Care Act went into effect). And who would they blame? It’s a tough situation, and fingers start pointing out who is to blame. And whether the blame is earned or not, it’s usually hard to change someone’s mind after they’ve decided.

There’s no doubt that increased healthcare costs are painful to employees. More money being taken out of the paycheck gives them less to work with at the end of the day—which is likely why 70 percent of employees view increased costs as a pay cut.

It’s important to understand how employee’s feelings about healthcare influence your company. In our recent healthcare study, we asked employees who they blamed most for the increased cost.

So, who do they blame most? The government.

Surprisingly, most employees understand that it isn’t really the company’s fault that costs have gone up. And only 16 percent blame the company.

Actually, employees don’t blame their company very much at all. Twice as many people blame their insurance companies—32 percent—for the increased costs.

So there are some things to be relieved about. Not many of your employees blame you. Of course, it would be better if we could decrease that number even more.

Consider this: 89 percent of those who blame their employer for increased insurance costs say they don’t understand how ACA affects their taxes very well or at all. However, of all employees who say they understand ACA well or very well, only 11 percent say they blame their employer. So, it’s pretty likely that those who blame you don’t understand ACA.

You can have a big impact on decreasing that number just by educating your people about ACA and how it affects your company.

Of course, you care that 70 percent of your employees feel like they’re getting a pay cut because of increased healthcare costs. Wage cuts can decrease employee productivity by up to 20 percent. How can you save your people from the sour attitude of feeling like you’re paying them less?

First of all, make sure the company is absorbing some of the increased cost too. It’s not fair to pass the entire burden onto the employee. Then, other than making the best choices for value of plans and providing different options that allow employees to choose the best value for their particular situation, you must communicate the healthcare plan’s value.

Do you show your employees the total value of their job by transparently letting them know what the company pays for their benefits? (You can in BambooHR!) I’m sure a lot of them don’t know (or even consider) how much of their plans you cover. Also, don’t be afraid to communicate with them when your costs increase. Sometimes employees forget that the company works within a budget and has financial concerns just like any household. It will help them understand that the company has to balance a checkbook, and that increases affect us too.

Add alternative value to your employees’ jobs if you can. Give them a raise or incorporate a new benefit to let them know how much you value them. Consider matching their contributions to an HSA.

No matter how much education you offer your people, it’s still a hard pill to swallow when healthcare costs increase. You don’t want any of your employees to blame your company for it. If you help even more employees understand the reasons behind the increase, how to best use their benefits to get maximum value and how much total compensation the company provides (they’ll be surprised at how high it is), they’ll blame you even less and appreciate you much more.

If you’d like to dive deeper into the data from this study, check out the full infographic and survey report.