The underutilisation frustration: How to make health benefits work

As we progress through the second half of 2024, Singapore’s job market presents a complex picture. A report from the Ministry of Manpower (MOM) in June revealed that the number of job vacancies has grown to 81,900 as of March, up from 79,800 in December last year. And while the number of unemployed individuals has also risen slightly in that same period, this tight labour market, characterised by more job openings than job seekers, underscores the urgency for employers to differentiate themselves.

In this competitive environment, robust employee benefits – particularly in health and wellbeing – have become essential tools for attracting and retaining top talent in Singapore’s growth sectors.

In Singapore, health and wellbeing benefits have become a cornerstone of the Employee Value Proposition (EVP) for many companies. Recent findings from Cigna Healthcare’s International Health Study of 1,000 HR leaders globally, including 200 in Singapore, reveal that 89% of Singaporean employers offer health benefits as part of their EVP. The study also found that after career progression, health benefits rank among the top three EVPs valued by employees, tied with time off and working arrangements.

However, despite their widespread availability, 65% of HR leaders in Singapore report that these services are underutilised by employees. This underutilisation presents a paradox, where the potential positive outcomes – such as reduced sick days, lower absenteeism, and improved productivity – may not be fully realized.

Lack of awareness and understanding

One of the primary reasons behind underutilisation is a lack of awareness among employees about the benefits available to them, often stemming from inadequate communication by employers. Research around the world has shown that many employees are unaware of the full range of benefits available to them, primarily due to inadequate communication from employers.

This challenge is particularly pronounced among younger employees, such as Gen Z and Millennials, who may have limited prior experience with benefits like health insurance and retirement plans. The complexity of these offerings, including detailed information about coverage, eligibility, and enrollment processes, can further complicate their understanding.

“One of the primary reasons behind underutilisation is a lack of awareness among employees about the benefits available to them, often stemming from inadequate communication by employers.” – Julie Lim, Key Accounts and Broker Relations Director, Asia Pacific, Cigna Healthcare.

Without clear, proactive engagement, employees may not fully understand what is available or how to access these benefits. To address this, employers must go beyond merely offering benefits – they need to actively educate and remind employees about the services available to them, making the process of accessing these benefits straightforward and transparent.

Misalignment of benefits being offered

Another critical factor contributing to underutilisation is the potential misalignment between the benefits offered by employers and the actual needs and wants of employees. While employers may offer a comprehensive range of benefits, these may not always resonate with employees’ current priorities.

Looking again at the Gen Zs and Millennials as an example of how misalignment could manifest, it is conceivable that younger employees might be more focused on immediate needs and may not fully appreciate the value of benefits such as mental health support or wellness programmes and might prioritise work-life balance and flexible working arrangements instead.

In fact, according to a Cigna Healthcare study from last year, 66% of Singapore employees listed flexible time off and work arrangements as an important element of a robust health and wellbeing programme, significantly higher than for mental health support (35%) and wellness programmes such as nutrition counseling (31%).

If the offered benefits do not align with what employees truly value, they are less likely to engage with them.

In addition, recent studies have shown that while employers in Singapore are making it a priority to offer support for mental and physical wellbeing, employees still view financial wellbeing support as their top area of concern even though this is one of the lowest priorities for employers.

Cultural stigma around mental health

But even if mental health support is one of the benefits on offer, it is worth remembering that in many parts of Asia, including Singapore, there remains a significant stigma surrounding mental health.

This cultural barrier can discourage employees from utilising mental health services, even when they are readily available. The fear of judgment or negative consequences can prevent employees from seeking the help they need, thereby limiting the effectiveness of health and wellbeing programs that include mental health support services.

Recommendations for employers

To address the issue of underutilisation, employers need to adopt a more proactive and tailored approach to their health and wellbeing strategies – Cigna Healthcare’s study from last year found that only 52% of employees surveyed in Singapore felt that their employer proactively supports their health and wellbeing.

Regular communication and personalised engagement are key to increasing awareness, understanding and comfort in using available services. Employers should also involve employees in the design and selection of benefits to ensure they are meeting real needs.

Cultural stigmas, particularly around mental health, must also be actively addressed. Fostering a workplace culture that is open and supportive of mental health discussions is crucial for employees to know it is safe for them to disclose such information, which will encourage them to take advantage of the services offered.

Finally, employers should conduct periodic reviews of their EVP to ensure alignment with the changing expectations and needs of their workforce. This will help in refining the benefits offered and ensuring they stay relevant and impactful.

Leveraging data and analytics

In today’s data-driven world, organisations have a powerful tool at their disposal to enhance the effectiveness of their health and wellbeing programmes – data analytics. By analysing data from various sources, such as health claims, employee surveys, and utilisation reports, employers can gain valuable insights into how their benefits are being used and identify areas for improvement.

Data from health claims can reveal which benefits employees are using most frequently and which are underutilised. For example, if data shows that a significant number of employees are making claims for stress-related conditions, it might indicate a need for more robust mental health support or wellness programmes targeting stress management.

Similarly, at Cigna Healthcare, having identified from claims data that musculoskeletal-related issues were one of the largest claims areas, we developed and introduced our Musculoskeletal Care Programme.

READ MORE: Mental health at work: Building an engaged and healthy workforce

The programme offers a personalised and comprehensive approach to managing musculoskeletal conditions by integrating various treatments like physiotherapy, rehabilitation, and clinical Pilates. It focuses on early intervention, using data analytics and predictive modeling to identify high-risk individuals, and guides them through a streamlined care journey aimed at preventing chronic issues and improving overall health outcomes.

Looking ahead

The underutilisation of health and wellbeing benefits presents a multifaceted challenge, yet it is far from insurmountable. By delving into the root causes of this issue and implementing targeted strategies, employers can unlock the full potential of their health and wellbeing programmes.

As we look to the future, emerging trends such as digital health solutions and personalised wellness programmes offer exciting opportunities to boost benefit utilisation. In the ongoing battle for top talent, it is crucial that HR leaders continually re-evaluate and refine their health and wellbeing strategies. Ensuring that these benefits not only meet the needs of employees but are also actively utilised will be key to sustaining a competitive edge as a choice employer.

About the author: Julie Lim is Key Accounts and Broker Relations Director, Asia Pacific, at Cigna Healthcare.