Every man for himself.
That's the approach to benefits many companies are taking these days as they cut health care plans and retirement contributions, a new survey says.
The Society for Human Resource Management, a global trade group in town at the Las Vegas Convention Center for its 18,000-attendee annual conference, released on Monday the results of a survey showing that some workplace benefits continue to shrink, even though the nation's economy has stabilized.
The study found that 77 percent of human-resources professionals say the economy has hurt benefits in 2011, up from 72 percent in 2010.
So why are benefits still hurting even as business picks up?
Part of it is lingering uncertainty about the economy.
Mark Schmit, director of research for the society, said businesses aren't sure about future growth, and that's affecting benefits.
"Employers are playing it a little safe, not knowing exactly where we're going yet," Schmit said. "We've seen some weakness in hiring numbers recently as well. We're just seeing businesses be cautious."
That caution means having employees manage and pay for more of their benefits. Nearly 85 percent of employers now offer insurance coverage through preferred provider organizations, while 33 percent use health maintenance organizations. PPOs give consumers more provider choices and cost them more out of pocket than HMOs. High-deductible insurance plans attached to employee-funded health savings accounts are more common as well, with 35 percent of companies offering the coverage. That's up from 29 percent in 2007.
And 93 percent of businesses now offer employee-funded retirement plans such as 401(k)s, with just 22 percent providing company-financed pensions (some companies offer both, which is why the number exceeds 100 percent).
At least one local HR expert says those benefits changes are permanent -- that the recession isn't the issue so much as a cultural change that's sweeping Corporate America. With that philosophical shift, employees will have to make and pay for more health care and investment decisions themselves, even after the economy picks up.
"I do see the burden is shifting to employees more and more," said Mary Beth Hartleb, CEO of Henderson-based Prism HR Consulting & Insurance Services and director of the Society for Human Resource Management's Nevada State Council. "Organizations are less paternalistic, and are saying, 'Hey, you work here, but that's a work arrangement. Why are we doing all of this (benefit management)?' "
That shift is happening partly because health perks in particular are becoming so expensive. Hartleb is seeing premium quotes jump as much as 48 percent a year, partly because of new coverage mandates in 2010's federal health-insurance reform law, which is taking effect in pieces through 2014. If reform continues on its current path, companies looking to avoid growing insurance costs will likely drop health benefits altogether, as state insurance exchanges offer coverage outside the workplace, Hartleb said.
Terry Coffing, president and managing partner of Las Vegas law firm Marquis Aurbach Coffing, knows firsthand about the rising cost of health insurance: The firm's premiums rose in November. Marquis Aurbach Coffing didn't cut health benefits, but it did pass a little more of the premium on to workers, Coffing said. The firm ate the rest of the increase. It has no plans to cut benefits now, but if things keep up the way they're going, cuts could be on the table. Coverage costs already affect some hiring decisions. Coffing said he's more likely to consider hiring file clerks and runners to work part time instead of full time, because part timers don't receive benefits.
"It's going to be something we grapple with constantly. There's so much uncertainty as to the effects (of reform)," Coffing said. "I just don't anticipate the expense going down. It's just a matter of how much of the increases we can absorb. Health care is almost eclipsing rent as our second-biggest business expense. It's No. 3 with a bullet."
When he networks with other attorneys, insurance costs are usually the No. 2 topic, right behind salaries, Coffing said.
"I haven't heard of across-the-board cuts, but they're having to make some changes. It's just such a tough decision. There's still a competitive market for good attorneys out there, and health insurance is one of those things we have to offer to make sure we stay competitive," he said.
Still, not all benefits are declining, human resources experts said.
Flexible work schedules are on the rise, as is telecommuting. More companies also offer supplemental coverage through insurers such as Aflac, which offers cash to help workers cover benefits health insurance won't pay for.
And unlike full health coverage and funded pensions, other benefits that have fallen off in the recession, such as relocation assistance, will come back after the economy turns around, Schmit said. Wellness programs such as smoking-cessation classes will also be popular in the future, as companies look to curb rising health costs. Plus, companies that can't afford health and retirement benefits anymore will probably pitch flexible schedules and work-life balance instead, Hartleb said.
Hartleb also said she foresees a future where benefits matter less than salaries, and pay may rise even as perks drop.
"To me, the interesting aspect is how you're going to attract and retain talent when the economy gets better," she said. "Companies may not be competing on health care benefits anymore. Maybe salaries will go up, because that's the only thing companies will be competing on."
Contact reporter Jennifer Robison at firstname.lastname@example.org or 702-380-4512.