Providing medical benefits amidst rising costs a huge pressure for SMEs in the US

A survey reveals that it is the biggest financial pressure for companies, due to concerns about profitability, affordability and rising costs.

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Providing medical benefits amidst rising costs a huge pressure for SMEs in the US

According to a recent survey of 230 companies in the US, released by Enterprise Bank & Trust, most small and medium-sized companies worry about providing medical insurance to their employees. Apparently, it is the biggest financial pressure for them.

More than the cost of the health insurance, or the loss of profitability, the biggest concern among employers is, the pressure they feel / face to provide insurance.

The survey highlights the three big concerns that businesses have, while providing health insurance. First is that the cost of the employee health insurance may negatively affect the company’s profitability. The second concern is that the premiums may make the employee health insurance unaffordable. And third, rising costs can render companies unable to provide salary increments or bonuses.

The survey lists a couple of alternatives for companies to reduce healthcare expenses.

One way is to reduce the cost of premiums through a benefits plan design. According to the report, self-funded insurance can lower premiums for employees, while possibly saving companies money through reduced operational costs.

Wellness and preventive care were listed as the next alternatives to reduce healthcare expenses. Investing in healthy employees can lead to lower costs in the future, thus leading to a better and efficient workforce. More than 50 per cent of businesses in the US offer preventive programmes to employees, including regular check-ups, screenings, health-education workshops and physical-fitness programmes.

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