In this report, ICONIQ Growth dives into our research and explores how and why tech companies are looking to restructure benefits programs going into 2023.

Research

ICONIQ Growth- Future of Work: Employer Benefits Series

Nayya Marketing 

This research report explores key challenges employees face to get the most out of their benefits and how holistic benefits guidance can help.

Blog Posts

Nayya's 2024 Open Enrollment Report

_The status quo will continue to challenge the American worker unless we harness the latest technologies to change the industry._

New York, New York, April 16, 2024 – Nayya, the data-driven adviser and leading provider of personalized employee benefits guidance, has published a report challenging the humdrum assertions made by many ecosystem players. The company, founded in 2019, already serves millions of employees, as well as many of the leading employers, consultants, PEOs, payroll companies, carriers, benefit administrators, and retirement providers across the United States. 

Nayya’s research showcases how offering more benefits is not solving the problem. Confusion and dissatisfaction with benefits are rising while the cost of living, healthcare costs, and inadequate retirement savings exert ever more pressure on employees. Traditional benefits education practices to drive benefits engagement continue to fall short of their promise, with point solution engagement in the single digits and as many as 60% of individuals selecting a more expensive health plan than they need.* Constant benefit administrator reports tout personalization and simplification. Why have these entities not solved the core challenges facing employees over the last 20 years?

Nayya’s report, titled "_Time to Build: How Employee Benefits Infrastructure Can Rise to Meet New Challenges_," comes at a time when nearly 50% of all Americans are concerned that a major health event would drive them into bankruptcy. Simultaneously, many of these same people are struggling with underutilizing their benefits. 

The standard industry approach is to throw more and more information at employees attempting to drive higher benefits engagement. And yet employee satisfaction with benefits reached an all-time low in 2023. Benefits education is often communicated in generic, long-form, and jargon-filled language. The entire employee benefits ecosystem has been constructed without a “last mile” adviser for the employee.

Nayya’s latest report offers a guide to understanding how the twin challenges of rising costs and low benefits engagement are causing employee benefits to fall short of expectations. In addition, it provides a first step for employers and consultants to take in delivering real value to employees. 

A new approach to employee benefits starts with holistic benefits guidance. In this new world, benefits pathways are tailored to the individual. These are based on health data, wealth insights, and tuned to personal preferences. The result is an employee benefits system that proactively delivers value in the moments that matter.

**Key highlights of the report include:**
- **Double Clicking into the Rising Costs and Impact to the Individual:** An overview of the current state of the economy and associated challenges facing employees, including why employers are in such a crucial position to help their teams navigate these times
- **The Role of Benefits in Financial Preparedness:** The significance of a cohesive benefits strategy in helping employees understand how to maximize the value of the resources available to them and bolster confidence in their protection
- **Driving Impact Through Digital-First Experiences:** Strategies for providing intuitive and effective benefits guidance that improve employee satisfaction and financial outcomes
- **Harnessing Technology for Holistic Guidance:** The importance of leveraging data-driven solutions to enable a scaled approach to optimizing benefits delivery 

Commenting on the release of the report, Catherine Spence, VP of Marketing & Member Impact at Nayya, said, "There comes a point where you have to cast aside systems that aren’t serving consumers. We realize that incumbent players delivering benefits guidance have proven unsuccessful. As an industry, we have the opportunity to make holistic, data-driven, benefits guidance the new standard of excellence.

Nayya is committed to continually providing research-based insights alongside our partners, so that we can collectively shift our focus to benefits that proactively, programmatically, and prescriptively deliver impact to employees. People deserve better support."

Time to Build: How Employee Benefits Infrastructure Can Rise to Meet New Challenges is now available for download on [Nayya.com](http://Nayya.com/time-to-build-report).

**About Nayya:**
Nayya is the leading provider of personalized employee benefits guidance. Leveraging data and technology to reduce user friction, increases benefits understanding, and drives benefits impact from enrollment to usage to re-enrollment. Nayya unites the employee benefits experience across health, wealth, and wellness to deliver clarity and efficiency across the entire benefits landscape. Nayya is proud to be trusted by the biggest name in benefits including MetLife, ADP, Prudential, and Guardian. Headquartered in New York City, Nayya is a privately held company backed by Iconiq, Felicis, and Viewpoint Investment Partners. For more information visit [www.nayya.com](http://www.nayya.com).


**Sources:**
* [_The Quarterly Journal of Economics, Volume 132, Issue 3, August 2017_](https://academic.oup.com/qje/article-abstract/132/3/1319/3769420?redirectedFrom=fulltext&login=false)


The traditional approach to employee benefits in the United States is failing to meet the needs of workers, with nearly 60% of individuals selecting more expensive health plans than they need. It's time for a new approach that focuses on personalized, holistic benefits guidance to improve the employee benefits experience.

News

We Need a New Deal for Employee Benefits

## Healthcare Benefit Costs to Increase

If there's anything that the last few years have taught us, it's that having a competitive benefits package is critical to a company's success. Attracting and retaining top talent has become increasingly difficult, and one of the key ways to stay ahead of the curve is by offering a benefits package that meets or exceeds the needs of employees and their families, giving them peace of mind. However, with healthcare costs rising faster than the rate of inflation, it's becoming more and more difficult for companies to offer comprehensive benefits packages without breaking the bank.

A recent study by Willis Towers Watson looks at the projected costs of healthcare benefits for 2023 and how they will impact employers.

## The 2023 Global Medical Trends Survey

For the 2023 Global Medical Trends Survey, Willis Towers Watson interviewed 257 leading health insurers in 55 countries over the summer of 2022. The survey projects that global healthcare benefits costs will increase to the highest level we've seen in over ten years. 

On average, global healthcare benefit costs are projected to increase by 10% in 2023, according to the report. This is a significant increase from the 8.8% rise we see in 2022 and the 8.2% in 2021.

## What's driving these increases?

There are a number of factors that are contributing to the rising cost of healthcare benefits. Here are some of the key drivers:

- **Global inflation**: Between the current international conflicts and supply chain issues, inflation has rapidly risen. This has directly impacted the cost of healthcare benefits as providers pass along inflation increases to employers.
- **The pandemic**: The ongoing COVID-19 pandemic has resulted in both a higher utilization of healthcare services and an increase in the cost of treatments. Many countries are still dealing with this pandemic, and the costs associated with the long-term effects are still being felt and difficult to predict.
- **Overuse of services**: The number one driver behind the rising cost of healthcare benefits is thought to be the overuse of services, ranked first by 74% of insurers. This means medical professionals are ordering more tests and procedures than necessary and overprescribing medications. This, in turn, drives the cost of healthcare up without necessarily improving the quality of care.
- **An increase in chronic conditions**: Along with an aging population, we're also seeing a rise in the number of people living with chronic conditions such as diabetes and heart disease. These conditions require more frequent and more expensive treatments, which drives up the cost of healthcare benefits.
- **Increase in mental health services**: For a long time, it felt like mental health was not acceptable to discuss in the workplace — but it's becoming more and more common to talk about these issues and seek treatment for them. The pandemic has also taken a toll on mental health, with anxiety and depression rates skyrocketing. The increased demand for mental health services has driven up the cost of overall healthcare benefits.
- **Poor lifestyle habits**: Despite all of the available information about the importance of maintaining a healthy lifestyle, unhealthy habits like smoking, drinking, poor posture habits, and a sedentary lifestyle are still quite common. These poor health habits can result in more serious or chronic health problems down the road, which drives up the cost of healthcare benefits.
- **Lack of preventive care**: Many people still don't see the importance of preventative care, such as routine physicals, screenings, and dental cleanings. The lack of preventive care often leads to more severe problems, which are more expensive to treat. The years of the pandemic lockdowns have also led to a decrease in preventive care. Many people have been afraid to go to the doctor or dentist, and access has often been limited due to physical distancing restrictions. Healthcare providers are still playing catch up to provide the necessary preventive care that's been missed over the past few years, and many patients are now dealing with the consequences.

## Healthcare cost increases across the globe

Although all countries are projecting an increase in healthcare costs for 2023, there are significant variations by region. In North America, for example, healthcare benefit costs are projected to increase by only 6.5%, lower than the 9.4% increase in 2022. 

In contrast, most regions will still see an acceleration in the growth rates of their cost of benefits.

Experts project that average healthcare benefit costs will increase in the Middle East and Africa by 11.5% in 2023, versus 10.5% in 2022, in Asia Pacific by 10.2% versus 6.9% in 2022, and in Latin America by 18.9% from 18.2% in 2022. Even in Europe, where healthcare costs have traditionally seen lower increases, they predict a rise of 8.6% in 2023 versus 8% in 2022.

Experts have warned that healthcare costs will carry on increasing unless we make fundamental changes to the way care is delivered.

## How to keep healthcare costs down

If employers want to keep their healthcare costs down, they need to make some changes to the way they're approaching benefits. Some of the ways they can do this include:
- **Offering incentives that encourage employees to live healthier lifestyles**. These incentives can include discounted gym memberships, on-site wellness programs, health coaching, healthy food options in the workplace, and health risk assessments.
- **Encouraging employees to use preventive care services**. This can be done by offering free or discounted screenings and physicals. Education is also key, and employers can provide educational materials on the importance of preventive care and how it can save money and improve quality of life in the long run.
- **Ask employees what they want from their healthcare benefits**. By understanding what your employees value, you can design a benefits package that meets your employees' needs and helps keep costs down. Using decision support software like Nayya can also support employees to make better choices about their benefits and find the providers that offer the best value for their specific needs, optimizing healthcare costs without sacrificing the quality of care.

A competitive benefits package is still a crucial element in attracting and retaining top talent. With healthcare costs still projected to increase, employers need to be strategic about how they design and manage their benefits as a recruiting tool.

With the right approach, taking proactive steps to support employees in maintaining good health and a balanced lifestyle and using decision support technology to make benefits more cost-effective, it is possible to keep healthcare costs down while still providing a comprehensive benefits package that meets the needs of your employees or potential candidates.

According to research from Willis Towers Watson, healthcare benefit costs will increase in 2023.

ICONIQ Growth- Future of Work: Employer Benefits Series

Future of Work Series: Employer Benefits

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Nayya's 2024 Open Enrollment Report

We Need a New Deal for Employee Benefits

Global Healthcare Benefit Costs to Increase in 2023

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