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In Practice

As Workplaces Diversify, Inclusive Health Care Benefits Can Lend a Competitive Advantage

There is broad agreement now that diverse workforces benefit businesses in tangible and intangible ways. Research has demonstrated that diverse teams question assumptions, make decisions more carefully, create more innovative products and solutions, connect better with customers, and generate better financial performance. The nonprofit research organization, the National Bureau of Economic Research, estimates that about 25 percent of the U.S. GDP growth per capita since 1960 can be attributed solely to the uptick of women and African Americans in highly skilled professions such as management, law, medicine and science.

Modern workforces are increasingly diverse along many dimensions, such as age, sex, ethnicity, religion, sexual orientation, gender identity, and disability. Women comprise 39 percent of the workforce globally, while the average age for a first birth has been rising, as have positive attitudes toward single motherhood. An increasing proportion of U.S. adults self-identifies as lesbian, gay, bisexual or transgender (LGBT), including 7 percent of millennials in 2016. More than 1 billion people experience some form of disability.

Diverse Workforces Need Diverse Health Care

As populations age and labor markets tighten in most parts of the world, inclusive recruitment enables companies to access broad talent pools. There is less awareness that diverse workforces come with different health needs and that this implicates employee benefits. Groups differ in terms of health risks as well as access to health care.

In terms of health risks, the World Health Organization notes that there are “gender-specific risk factors for common mental disorders that disproportionately affect women” and LGBT+ people, and diabetes risk can vary by ethnicity. In terms of access, discrimination and negative remarks from health care staff remain barriers for LGBT+ people, and female employees often lack or have restricted access to prenatal care, menopause treatment, screening for breast or cervical cancer, and other female-specific health care needs. Limitations can take the form of waiting periods, out-of-pocket costs, limited availability or blanket exclusions in some countries.

Traditional Health Care Policies Do Not Attract a Diverse Workforce

Employers who maintain traditional, broadly defined benefits programs risk excluding minorities and vulnerable groups in the workforce for many reasons.

Benefit programs were originally developed for a relatively homogenous segment of the population (males of dominant ethnicities, within a certain age range) and underpinned by certain assumptions that are no longer true, such as the bread-winner model, with wives responsible for child care, elderly care and household work. Traditional benefits programs under-serve groups with different needs and circumstances.

Most benefit plan designs are based on what other employers offer in a market, but this benchmarking approach misses blind spots and perpetuates disparities. If a company’s reference peers show minimally helpful coverage or do not provide medical coverage, or do not provide medical coverage for HIV treatment, hearing devices or gender affirmation treatment, for example, then the company will not add such coverage based on benchmarking alone.

Invisible Health Costs

Employers lack awareness of the scale of some problems and their impact on employees and the business. When mental health services are not covered, the mental health issues become invisible in an employer’s medical costs, and the hidden costs of this, such as productivity loss, are rarely measured.

There are also wide variations in regulations and mindsets across countries, which multinational companies find challenging to manage. Laws and social norms affecting LGBT+ employees run all the way from strong acceptance to outright bans on expressions of sexual diversity.

Employers may also lack the ability or support required to implement inclusive benefits: One in five companies in a global Mercer survey reported that there are no existing vendors or carriers to provide consistent benefits to LGBT+ employees.

Inclusive benefits are the right thing to do: They maintain employee health, prevent disease, promote equality and help everyone feel their health is valued.

The Risk of Unconscious Bias

Finally, unconscious bias exacerbates many drivers of incomplete coverage, causing misinterpretation of regulations, incorrect assumptions that government programs cover certain services when access and quality might be inadequate (for example, HIV treatment, mental health services, or ancillary care for gender affirmation services that improve social and psychological outcomes); reluctance to accept new societal trends (such as women’s participation in the workforce); and lack of attention and investment (such as the ways in which workplaces are inaccessible to differently-abled people).

Employers will need to examine their assumptions to ensure they offer equal opportunities to every employee and reach truly equitable and sustainable outcomes.

Building an Inclusive Health Care Plan

Employers have generally tackled diversity through corporate policies, but inclusion must happen at the level of the individual. To make benefits inclusive, employers must first get the policies right through a formal approach, but also create and sustain a set of habits and behaviors that happen daily, almost without thinking, across the enterprise.

For employers wanting to lead the way on inclusive benefits, we suggest starting with a four-step process:

Assess gaps in current benefits. Employers can start by assessing gaps in current benefits and identifying priority segments, themes and countries. As part of this assessment, they should validate the baseline of coverage in their medical plans as well as government programs in the relevant countries. This exercise can ensure accessibility and quality, while optimally allocating costs and resources by country.

Define and uphold global minimum standards. Employers should set a clear internal bar across the company based on employee needs, diversity and inclusion philosophy, legal risk tolerance, and clinical best practices.

Design a global strategy. Employers can then develop a plan for deploying their global minimum standards consistently in different countries. This would involve creating a roadmap over a time frame of three to five years, with strong buy-in from senior stakeholders.

Challenge the status quo. To avoid waiting too long to close prioritized gaps, employers will need to encourage internal decision-makers as well as consultants, vendors and carriers externally to create alternative vehicles.

Inclusive benefits are the right thing to do: They maintain employee health, prevent disease, promote equality and help everyone feel their health is valued. The gains from such benefits can accrue to specific minority and vulnerable groups, but also employees more broadly: Inclusive family planning benefits (such as fertility care) may be introduced to meet the needs of certain groups, but can be relevant to many others within the workforce.

Finally, there are solid business reasons for inclusive benefits: An edge in attracting and retaining employees, a value proposition that resonates with consumers and other stakeholders, and increased innovation and performance in times of disruption and transformation.

Diego Ramírez

Principal at Mercer Health & Benefits

Diego Ramírez is a principal at Mercer Health & Benefits, and leads innovative benefits design and solutions to address gaps in women’s care, LGBT benefits, elder employee care and employees experiencing mobility.

Kavitha Hariharan

Director of Healthy Societies at Marsh McLennan Advantage

Kavitha Hariharan is a director at Marsh McLennan Advantage, where she leads research on societal aging and health.

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