Employers Grapple with Workforce Mental Health Needs Post-Pandemic

August 23, 2023 - Mental health has been a primary focus for employers following the peak of COVID-19. As the pandemic becomes more manageable, large employers are implementing strategies to address access to care, burnout, and quality of mental healthcare, a Business Group on Health survey found.

Business Group on Health conducted the survey in June and July of 2023. The respondent pool encompassed 152 large employers that represent approximately 19 million covered lives.

Employers’ laserlike focus on employee health and wellness has not waned in the aftermath of the pandemic’s peak.

“A key finding here is the dire need for mental health services and supporting their employees as they're navigating their myriad needs in the area of mental health,” Ellen Kelsay, president and CEO of Business Group on Health, underscored in a press call.

The mental health impact of the pandemic is no longer theoretical or projected for employers. Over seven out of ten employers (77 percent) noted an increase in mental health issues in their workforce in 2023, a big leap from 44 percent of employers in 2022. Another 16 percent of respondents expected to see more increases in the coming year.

Looking to the future, increasing access to mental healthcare services was the most common initiative that employers expected to implement in 2024.

A couple of mental health focus areas saw an uptick in employer interest. The share of employers who expected to focus on adolescent or young adult mental health jumped from 17 percent in 2023 to 24 percent in 2024. Those who anticipated focusing on loneliness increased from two percent to six percent.

Brenna Shebel, vice president of Business Group on Health, emphasized in the press call that the key areas of focus vary widely based on the type of company.

The survey dove into how employers would increase access to mental healthcare and how they would improve the mental healthcare culture at their companies.

The top strategy for expanding access to mental healthcare in 2023 was providing online resources such as apps and webinars. The share of employers adopting this strategy in 2024 is expected to dip slightly from 97 percent in 2023 to 94 percent in 2024.

There may be a significant increase in the number of employers that choose to expand their mental healthcare networks to address access to care in 2024. In 2023, a little less than half of employers chose to expand their networks. However, 63 percent of employers expect to do so in the following year.

The share of employers who offer mental health navigation programs has been steadily increasing. These programs direct employees to mental healthcare providers and support them during their search.

In 2022, two out of ten employers offered navigation support. In 2023, slightly more than three out of ten employers took this approach and, in 2024, 44 percent of employers expect to expand their networks to boost mental healthcare access.

In their efforts to improve company culture, the top strategy has remained consistent over two years: three-quarters of employers offer manager training to recognize mental health issues and ways to support employees whose mental health is flagging (74 percent). That trend is expected to continue into 2024.

There has been a growing interest in peer and employee training programs. These programs serve a similar purpose as the manager training programs, but they are geared toward employees so that workers can identify and support struggling colleagues.

One category of company culture improvement strategies saw a sharp decline in recent years. Anti-stigma campaigns, which used to be the second most popular category in 2022 with a 70 percent adoption rate, dropped to 54 percent adoption in 2023 and are expected to decrease even further to 51 percent the following year.

“With anti-stigma campaigns…this is one area where we don't necessarily think it's a bad thing [that there is a downward trend]. It's really reflective of the progress that employers have made in addressing the stigma of mental health within the workplace,” Shebel explained.

In order to improve affordability, employers increased access to no- or low-cost virtual telemental healthcare counseling (77 percent in 2023, 70 percent anticipated in 2024). They also improved coverage for out-of-network treatments for both mental health needs and substance abuse care (35 percent in 2023, 37 percent anticipated in 2024).

Around a third of employers sought to improve affordability by implementing on-site mental healthcare at no- or low-cost to employees. This strategy, Shebel noted, tackles both the affordability and access challenges of mental healthcare.

The shares of employers implementing centers of excellence for mental healthcare and substance use disorders are expected to jump significantly in 2025 and 2026.

Although only around a third of employers are offering or will offer centers of excellence (COEs) for mental healthcare and substance use disorders in 2023 and 2024, by 2025 and 2026 more than half are expected to have adopt this strategy. Around 53 percent of respondents expected to adopt mental healthcare COEs in 2025 and 2026 as well as 52 percent who anticipated adopting substance use disorder COEs.

In addition to current concerns around employee mental health, employers expected stark trends in chronic disease. More than four in ten employers expected that higher chronic disease management needs would increase (41 percent) and the same share of respondents anticipated a higher prevalence of late-stage cancer diagnoses. Both projections highlight the importance of honing chronic disease management strategies.

“Certainly, the pandemic emphasized the importance and the role of health and well-being within the workplace, and employer focus post-pandemic has not dissipated,” said Kelsay.

“In fact, it remains acutely strong with significant additional investments being made in this space. So for many reasons, employers are going to continue to stay focused on investing in …the health and well-being of the workforce. Part of it is employee retention, of course, employee health, and wanting to have the healthiest and most engaged workforce possible. Obviously, that drives their business performance and overall productivity as an organization as well.”