Most employers concerned over the ramifications of potential healthcare reform legislation: IDC study

Nov 17 2009

IDC has released a new special research study on the market for employee benefits administration in the U.S., which shows that over 70% of all employers - both small and large - are either concerned or very concerned over the ramifications of potential healthcare reform legislation. While concerned with the as-yet-undetermined changes in legislation, the rising costs of providing employees with health and welfare benefits is even more of a concern to buyers, with over 80% reporting it as the top challenge they face.

This IDC special study entitled, Benefits Administration in Turbulent Times: U.S. Buying Behavior and Intentions (IDC #220576), is a research and survey project aimed at delivering insight into current benefits management trends and practices. This report represents the most comprehensive research focused on the market for benefits administration services in recent years.

"Employers outsource benefits administration in varying degrees based on size and complexity of the benefit plans involved," says Lisa Rowan, program director HR, Talent and Learning Strategies for IDC. "Buyers are expressing concern about pending healthcare reform and the rising costs of offering benefits. Those that opt to use outsourcing services are generally pleased with the service and few are looking to bring the administration back in-house. Going beyond the obvious need for good service, suppliers should focus on cost containment, flexibility, and good underlying technology to retain client satisfaction."

This research also revealed a number of trends including:

• Few employers assume the full financial burden of employee benefits with 96% of participating companies offering benefits to which the employer and employee both contribute.
• The overwhelming majority of companies plan to keep benefits spending levels the same for the next 12 to 18 months.
• Over 70% of all employers, both small and large, are either concerned or very concerned over the ramifications of potential healthcare reform legislation.

Benefits Administration in Turbulent Times: U.S. Buying Behavior and Intentions (IDC #220576) is based on a survey of 416 HR executives across a variety of industries and sizes in the U.S. and offers insight into topics ranging from delivery model to top buyer concerns. This study can help organizations determine by company size what health and welfare benefits are offered and how are they being administered; gain an understanding of the key drivers of outsourcing versus managing administration in-house and what would cause buyers to consider one over the other; and buyer plans for spending on employee benefits for the next year.