public healthResearch by Employee Benefits has revealed that 78% of respondents to its study feel that cost is the main influencer behind their decision to buy, or continue to offer healthcare benefits.

The Healthcare Research 2013, which surveyed 376 HR and benefits professionals, also discovered that only 7% calculate the return on investment (ROI) of their healthcare spend, down from the 10% that did so in 2011.

It also found that 64% do not calculate the ROI of their benefits spend, with 29% stating that they do intend to do so.

According to the study, the cost of providing health-related benefits has remained fairly consistent over the years. In 2006, 26% of those surveyed spent less than 1% of payroll on providing health-related benefits, while 20% spent between 3% and 5%.

The 2013 research revealed that 20% of employers spent less than 1% of payroll on the provision of healthcare benefits, with 30% claiming they spend between 1% and 3%.

Commenting on the research, Employee Benefits Deputy Editor, Debbie Lovewell, said:

“Over the 15 years that we have been conducting this research, we have collated a wealth of data that enables us to track trends around the healthcare benefits employers’ offer and the strategies these support.

“One of the biggest developments in recent years has been employers’ increased focus on employee engagement and the role benefits have to play in an engagement strategy. This is reflected in respondents’ views about what their organisations’ healthcare benefits have been successful in achieving.”

Highlighting this year’s findings, she said:

“This year, 51% said their healthcare benefits had been successful in improving employee engagement. This is an increase from the 33% that said the same in 2010, which itself was a rise from 26% in 2009.

“This increased focus on using benefits to improve employee engagement also ties in with what we are seeing in other benefits areas.”

Lovewell continued:

In some areas, what has not changed is equally significant. Over the years, the proportion of respondents that actively measures the return on investment (ROI) on their healthcare spend has remained consistently low. Back in 2007, for example, just 5% said they did so. This year, 7% said that they calculate the return they are getting for their money (an identical percentage said so in 2009).

“Healthcare benefits can represent a significant portion of an organisation’s benefits spend, so it is surprising that this percentage has remained so low. Given the general focus on cost control and reduction, as well the need to demonstrate value on any spend, during the recession and ongoing economic downturn, it may have been expected that more employers would turn their attention to ROI.”