New EBRI Research: New Study Explores Returns to Employers Who Offer Workers Health Insurance

3/16/2004

From: Jim Jaffe, 202-775-6353 or jaffe@ebri.org, or Paul Fronstin, 202-775-6352 or fronstin@ebri.org, both of the Employee Benefit Research Institute

WASHINGTON, March 16 -- A new study of selected large employers who offer their workers health insurance coverage augmented by a comprehensive array of worksite accessible health management resources, concludes that such arrangements create a more productive workplace, reports the Employee Benefit Research Institute (EBRI).

Researchers interviewed executives at six major firms that provide health insurance for more than a quarter million employees with an eye to why they believed providing such coverage and other health management services was beneficial to the employer. The firms included Bank One, Elkay Manufacturing, Sherman Health and the Union Pacific Railroad. The largest firm included has 74,000 employees; the smallest, 2400.

The results are summarized in EBRI's March 2004 Issue Brief.

Employers believe providing health benefits is an important device to enhance employee recruitment, retention, and productivity. And the firms researched believe that healthier, happier workers yield better economic results for them. Each has tried to construct a structure that maximizes the return it receives from the benefit

If more employers were convinced of the value of benefits, employer-linked health insurance, which already provides protection to more than 175 Americans, would be more widespread, the report concludes. "In the long run, evidence suggests that the willingness and ability of employers (which are the primary source of health benefits for workers and their families in the United States) to sponsor health care coverage and other health services will depend on the importance of these benefits to the success of the business," the report concludes.

"As employers get increasingly sophisticated about this issue," said EBRI president and CEO Dallas Salisbury, "the specific advantages of providing health benefits will become clearer."