If You Calculate ROI on Healthcare, Here’s Why You Should Use VOI (Value of Investment) Too
A Korn Ferry report estimates talent shortages will cost $435 billion in shortfalls by 2030 within the financial and business services sector. What are you doing today to make sure employees stay tomorrow and beyond?
A solid benefits strategy is a part of every company’s retention strategy. To get the whole picture, you’ll need to look beyond dollar signs. The value on investment (VOI) is a big-picture analysis that shows the broad impact of health and wellness programs. It’s not as tangible as return on investment (ROI). Still, it does show the ripple effect your programs have on the company.
ROI is just one piece of the equation
Many companies look at the return on investment (ROI) once a year. One standard metric compares the cost of a benefits program to claims costs related to the program. At a minimum, the ROI should be 1x. That is, benefits should bring back the dollars invested.
However, proving value is more than lowering costs. ROI is a good starting point, but it’s not the whole picture. ROI is limited to measuring financial outcomes while VOI dives into other results like improved health and wellbeing.
VOI goes further than stretching your buck
It’s essential to know how the benefits you choose help your bottom line. The focus of VOI is on worth and usefulness for employees. Success translates to:
In addition to ROI, VOI is how benefits providers prove value to employers. At the same time, employers know the benefits package they offer makes a difference in employees’ wellbeing. VOI offers tangible goals and measurable outcomes that don’t require years of data as ROI does.
A benefit won’t go anywhere if employees never access it. Determine the percentage of people in the company who signed up for the program, and analyze the reasons they may or may not have chosen to sign up. Are some departments better educated than others on benefits? Is one type of benefit more useful to some employees compared to others? Your benefits provider can discover trends among your employees.
Following enrollment comes employee engagement. It doesn’t matter how many people sign up for a flashy new benefit if they never use it. Even if a benefit has fewer signups than expected, high engagement from those signing up is a promising sign. These employees may be logging in often, accessing programs, scheduling visits, or communicating with specialists. If this is the case, you may need to change your marketing strategy. You and the benefits provider can help drum up interest with lunch-and-learns or reminders to use the benefit before expiration.
Employers do care that their employees are happy and healthy, even beyond the cost to the company. What did your benefits provider promise when it came to your employees’ health? Focus on those specific health-related benchmarks and your company’s medical claims history when reviewing your benefits.
Benefits providers may also claim that their programs improve morale and productivity. Yet, when is the last time you saw either metric at an end-of-year benefits review? Get ahead by creating a baseline that includes key performance indicators (KPI’s), such as the number of orders met and customer service ratings. After one year with a benefit, see how your KPIs changed.
Attracting, retaining, and serving talent
The right benefits package can help attract top talent and keep valued employees on board. In a 2018 AHIP survey, 37% of adults in the US reported that health benefits were a positive factor in choosing to work for their employer. The same study says quality benefits play an even more significant role in retention. 56% of employees reported benefits as an important factor in staying with their employers.
Sometimes, people don’t know what they need until companies offer it. Trying a multi-point benefit is a great way to take care of multiple needs for employees. For example, in a recent Goodpath employer case study, a company onboarded Goodpath for their innovative MSK program. It was a surprise to the benefits manager, though, how many people used the sleep solutions as well. Employees later reported appreciation for the accessibility of the sleep program through their employer. They had needed a sleep solution but had not known where to look for it.
Goodpath is here to help
At Goodpath, we’ll help your employees with musculoskeletal, sleep, and digestive health needs through integrative care. We focus on the whole person and create programs to meet their short- and long-term health needs.
Goodpath works with your existing benefits strategy, providing end-to-end care that complements conventional care. Implementation can take less than two weeks, from first introductions to open enrollment. Learn more about how Goodpath can help at goodpath.com/employer.