Employer Sponsored Health Plans Will Prioritize Mental Health in 2023

August 25, 2022 - Large employers plan to expand mental health and virtual care offerings in their 2023 employer-sponsored health plans, but concerns about healthcare costs and health equity persist, according to a report from Business Group on Health.

The 2023 Large Employers’ Health Care Strategy and Plan Design Survey reflects responses from 135 large employers who cover 18.3 million people across the country. The survey was fielded between May 31 and July 13, 2022.

 “Survey findings function as a ‘collective snapshot’ that can guide employers as they determine how to maximize employee benefits,” Ellen Kelsay, president and chief executive officer of Business Group on Health, said in the press release.

“Employers shared that they are deeply concerned about unsustainable healthcare costs, the devastating effects of the pandemic on employee health, and the need to work creatively with their partners toward a more positive and sustainable healthcare experience, among other issues.”

Sixty-five percent of employers said they view their health and wellbeing strategy as an integral part of their workforce strategy. This figure is up from 42 percent last year.

Employers have already seen significant impacts of the COVID-19 pandemic on health and wellbeing. Almost half of the employers reported seeing long-term mental health issues (44 percent) and an increase in medical services due to delayed care (43 percent).

More employers anticipated seeing higher chronic condition management needs (56 percent) and a higher prevalence of late-stage cancers (44 percent) in the future due to the pandemic.

Employers made several changes in 2022 that they plan to continue, including expanded telehealth and virtual health offerings (94 percent) and expanded mental health benefits and coverage (85 percent).

Around half of the employers plan to continue to develop new health and wellbeing programs for remote employees and expand focus on social determinants of health.

Three-quarters of employers reported being concerned about health equity in their company health and wellbeing initiatives.

The majority of employers said they plan to implement strategies to address health inequities within women’s and reproductive health by 2023. The top focus areas included expanding fertility benefits, identifying high-risk pregnancies, and expanding coverage to treat postpartum depression.

Regarding mental health, employers are most focused on improving access (80 percent) and reducing stigma (40 percent) and burnout (33 percent) among employees. Offering online resources and providing manager training to help recognize mental health issues are their top strategies for addressing these concerns in 2022 and 2023.

Employers have also utilized virtual care to help increase access to mental healthcare and lower costs. Nearly 75 percent believe virtual health will significantly impact how care is delivered in the future, though this figure has decreased from 85 percent in 2021.

Despite their intention to continue expanding telehealth, respondents noted concerns regarding virtual care. For example, 69 percent of employers were concerned that a lack of coordination between virtual and community-based providers creates a siloed care experience for employees.

The report also revealed that cancer is the leading condition driving employer healthcare costs. Musculoskeletal and cardiovascular conditions followed. To address cancer costs in 2023, employers plan to develop centers of excellence for cancer (50 percent), cover genomic testing for cancer treatments (32 percent), and cover multicancer early detection blood tests (11 percent).

Total employer healthcare costs increased by 8.2 percent in 2021, the report noted. Employers were particularly concerned with pharmacy costs, as they account for 21 percent of overall healthcare spending. Further, specialty medications account for 56 percent of all pharmacy spending.

Employers plan to manage the cost of specialty medications by requiring prior authorization through both pharmacy and medical benefits.

By implementing these strategies, employers said they hope to cover 82 percent of the cost of employee coverage in 2022, up from 80 percent in 2021.