Healthy life expectancy: why employers need to restructure and reset their benefits now
The gap between healthy life expectancy and life expectancy is widening.
Over the last decade, healthy life expectancy (HLE) in the UK has fallen by around two years to just under 61 for both men and women. With recent data from the Office for National Statistics revealing that the current average life expectancy is 79 for men and 83 for women, people are likely to be living for around two decades in poor or declining health with this period starting prior to retirement.
What the data behind declining health tells us
Based on mortality rates and levels of self-reported good health, HLE at birth is a key measure of the population’s health and estimates how much of an average lifetime is expected to be spent in ‘good’ general health.
The Health Foundation’s report, informed by data from the Office for National Statistics, not only revealed that HLE fell by approximately two years over the decade from 2012-2014 to 2022-24 but also the impact demographically. Across all the nations of the UK, HLE has declined more for women than men. Wales has the lowest HLE for women, while Scotland has the lowest HLE for men. England has the highest HLE of the four nations but marked regional differences persist with the north-south divide clearly apparent.
From an employer’s perspective, what is particularly concerning is that in more than 90% of areas HLE is now below the state pension age, which recently rose to 67.
Why the working age population needs proactive protection
The downward trend in HLE adds to the growing evidence of declining health in the working age population, reducing workforce participation and productivity. According to the Chartered Institute of Personnel and Development, long-term sickness absence has reached 9.4 days per employee, while the final Keep Britain Working report states that the cost of poor workforce health to employers is roughly £85bn a year.
In addition to physical health, mental health can also affect the ability to work. A new report by Zurich predicts that 32% of working age adults will live with a mental health condition by 2030 and forecasts mental health-related productivity losses to exceed £170bn.
Early detection and a robust early intervention service can improve health outcomes for employees, reduce absenteeism and presenteeism and build a stronger culture, while also allowing employers to spend smarter by reducing business costs including health insurance. To protect their workforce’s wellbeing, employers must be proactive, not reactive, and put their teams’ needs first.
Pressing the button to reset and restructure benefits
Employers need to go back to basics to restructure or completely reset their benefit offerings, listening to what employees really want to provide a meaningful suite of protection that meets the different needs of its workforce’s demographics and prolong their good health. The solutions should contribute to the bigger picture, thinking not only of how to support employees today but also tomorrow.
Early intervention is a gamechanger as modern insurance strategies are increasingly focused on prevention rather than cure. However, many businesses spend on benefits that employees don’t necessarily want, for example offering reactive private healthcare rather than more proactive, in demand wellbeing tools like private medical insurance (PMI).
Designed to work alongside private healthcare and the NHS, it has become the number one benefit in employee benefits, often ranking above longstanding benefits like flexible working and enhanced pensions, and for good reason. PMI can provide faster access to treatment, health screenings and mental health support, highly valued by employees and their families.
As the gap between how long people live and how long they stay healthy, including at work, continues to widen, not reviewing, restructuring or resetting your benefits is a costly option. Businesses that adopt predictive, targeted and preventative health approaches that are tailored to the needs of their teams will deliver the most value, to their employees and the business.
Based on our expertise in the healthcare market, our employee benefits team can look at all the options available to you, consulting on bespoke health strategies and guide you down the right path.
Graham Yearsley, Head of Employee Benefits
Click here to find out more about Graham Yearsley