Why Employers Must Champion Health Access and Equity: The Broader Impacts and Benefits

Often, when we discuss unequal access to healthcare, our thoughts shift to those who are uninsured, unemployed, or otherwise socially and economically disadvantaged. We think about the impacts on these individuals – worsened health outcomes and increased financial strain, “perpetuating a cycle of disadvantage” as one healthcare analyst recently so aptly described.

We also tend to couple the topic of “health equity” with governmental intervention or policy reform, which can leave us feeling that real improvement can only come from Washington.

However, I'd like for a moment to speak to health access issues among those who do have health insurance, specifically through their employers and how barriers to care for this population impacts us socially and economically.

According to the Kaiser Family Foundation, just under 160 million people in the US are covered by employer-sponsored health plans.

Within this population, over half of employees have reported deferring or skipping care due to costs. They struggle with deductibles, co-pays, and cost-sharing – the out-of-pocket expenses needed to access care. Even with insurance, many employees face significant financial barriers when seeking healthcare. Broader economic pressures, including rising costs for gas, food, housing, and healthcare, are straining household budgets.

These cost hurdles aren't a result of poor plan designs by employers or benefits consultants; quite the opposite. Employers have continually adjusted their plans in an attempt to keep up with the rising costs of care, but the reality is the underlying cost of healthcare services has increased more than 30% over the Consumer Price Index for all goods and services over the past 20 years. Put another way, compared to the increases we all see in the cost of groceries or gas, healthcare costs have increased 30% more. For your company, this is an important comparison - the price for the goods and services your company provides has not increased at a rate to cover increases in healthcare costs. This means a higher share of margin is spent on healthcare - which leaves less money for investment in innovation, growth, wage increases, etc.

And for employees, healthcare costs have increased a staggering 162% while wages have increased 24% over the past 10 years.

For employees, the impacts of deferring or skipping care due to cost mirror those faced by the uninsured: more severe health outcomes, increased chronic disease, and financial strain. When employees cannot afford to access care, the ripple effects extend beyond their household, and even beyond their company - multiplied across the 160 million people with employer-sponsored insurance, these issues contribute to broader economic and social challenges.

Impact on Business

1. Higher Claims Costs: Employers bear higher healthcare claims costs due to delayed or deferred care leading to more severe health conditions. This results in higher overall costs and higher premiums.
2. Reduced Workforce Productivity, Wellness, Health: A workforce grappling with untreated health issues is less productive. This inefficiency can lead to lower economic output and reduced competitiveness - impacting revenue growth, margins, and ultimate profitability.
3. Higher Insurance Premiums: As healthcare costs rise, insurance premiums for both employers and employees increase. Higher premiums reduce margins for employers which can impact wages and slow investment in new products and growth, and ultimately impact overall profitability.
4. Wider Health Disparities: Financial barriers to healthcare exacerbate existing health disparities, particularly affecting lower-paid, diverse and marginalized communities. Poor health outcomes in these populations can lead to cycles of poverty and social inequality, creating long-term societal challenges.?

Broader Economic Impact

1. Cost of Goods and Services: As companies face rising healthcare costs, they often increase the prices of their goods and services to offset these expenses. This contributes to higher inflation, reducing the purchasing power of consumers and increasing the cost of living.
2. Impact on Small Businesses: Small businesses, with fewer resources to absorb increased healthcare costs, may struggle to compete. This can lead to business closures, reduced job opportunities, and further economic instability.
3. Reduced Consumer Spending: With more income diverted to healthcare expenses, families have less money to spend on other goods and services. This reduction in consumer spending can slow economic growth and affect industries reliant on consumer demand.
4. Inflationary Pressures: The cumulative effect of increased costs for goods and services, higher insurance premiums, and reduced consumer spending can create inflationary pressures, making it more difficult for families to afford basic necessities.

?In summary, when we think about healthcare access and health equity, the issue extends beyond the populations we often consider. Barriers to healthcare access exist across a broad segment of our population - including employees. They directly impact your co-workers, your neighbors, and there’s a better than 50-50 chance that you’ve faced cost hurdles when accessing your own care. These barriers are certainly affecting your company’s bottom line, which impacts you in the form of the wages you make, and your overall quality of work-life.

They affect the price you pay for your own health insurance and healthcare services, the price you pay for food and goods, and the cost of supplies for your company or business.

I offer this perspective for a couple of reasons.

First, to highlight the broad impact of healthcare access and health equity issues. This isn’t just about an unemployed or underemployed population. It’s not purely a public policy issue about providing people with equal access to care. This is a very relevant and real issue that impacts companies, materially, every day.

Second, to emphasize that we – as business leaders, company owners, employers, and benefits consultants – have the ability to create meaningful impact for the 160 million people who receive their healthcare coverage through their work - and meaningful impact for the companies they work for.

By recognizing and addressing these challenges, we can improve health outcomes, enhance productivity, and support the financial well-being of our employees, ultimately benefiting our organizations and society as a whole.

I offer this as a call to action for employers – whether you’re a company of 500 or 15,000, it is a certainty that people in your organization face cost hurdles when getting the care they need. Addressing those issues will have benefits well beyond your bottom line. I encourage you to explore how you can make an impact for your employees and your company this benefits season.