PEOPLE ENVIRONMENT
Aligning workforce strategy with care & cost pressures
Rising demand for care across service lines, sustained cost pressures, and workforce challenges are driving the need for healthcare organizations to take a more proactive approach to aligning their overall human capital, benefits, and care delivery strategies.
Demand for services continues to rise
Health systems are experiencing sustained growth in patient demand and service expansion, increasing pressure on staffing models and care delivery capacity.
Workforce challenges
Recruitment and retention challenges in key areas continue as organizations work to meet the growing need for care amid shifting workforce expectations.
Care and benefit costs intensify
Rising labor, supply, and pharmacy costs are influencing both operating expenses and total rewards programs. Benefits costs are a significant and growing expense.
Shifting employee expectations
Healthcare workers across roles are increasingly focused on flexibility, affordability, and the perceived value of their benefits and work experience.
Addressing healthcare staffing challenges
Healthcare organizations are navigating persistent staffing challenges while demand for care rises and agency staffing is costly. When these workforce challenges are not addressed, the downstream impacts are significant and result in lower patient satisfaction scores, which are crucial for value-based contracts and revenue capture. They could also negatively impact safety and quality of patient care, which in turn increases malpractice exposure.
Recruitment & retention: Moving beyond one-size-fits-all approaches
Healthcare organizations employ a wide range of personas, including clinicians, executives, and administrative staff, each with distinct needs and expectations. As a result, one-size-fits-all approaches to benefits and rewards are not effective. Meaningful engagement requires personalized strategies that reflect both role-based needs and shifting priorities across the employee life cycle.
To respond effectively, organizations must rethink the healthcare workforce of the future and understand what different employee segments value the most, which is increasingly critical for recruitment, retention, and sustained engagement.
Workforce challenges and needs vary by role and market
ROLE-BASED FLEXIBILITY
While healthcare typically requires in-person care, management roles and administrative staff are experiencing more flexibility, which could influence job satisfaction and retention.
REMOTE WORK
Remote work is also more significant for administrative staff, especially in rural areas, where it is becoming a key component of job satisfaction and retention strategies.
While flexibility is changing expectations across certain roles, geography also influences how organizations should compete for talent:
URBAN ENVIRONMENTS
In urban environments, the challenge is competition, as organizations compete for the same pool of candidates. Healthcare systems must closely monitor their market positions and benefits offerings to attract and retain talent.
RURAL ENVIRONMENTS
Rural communities struggle to recruit healthcare professionals due to a smaller talent pool. In a rural setting, organizations need to think more creatively about recruitment.
Rising employee benefits costs
As healthcare organizations work to attract and retain talent, they are doing so in a difficult financial environment. Providers are under pressure from many directions at once, delivering quality care while managing policy changes, higher labor and supply costs, a sicker population, and tensions with payers on reimbursements, prior authorizations, and more.
One of the most significant pressure points is the cost of employee benefits. Healthcare organizations are facing sustained cost increases across their benefits programs and total rewards strategies while the cost of delivering care continues to rise.
Unlike other industries, healthcare employers must manage these pressures while also serving as both care providers and health plan sponsors, further complicating decision-making.
Employer health plans are facing a new level of cost intensity and unpredictability as care becomes more complex and high-severity claims rise.
Near-million ($500K+) and million-plus ($1M+) claims have grown more than 40% since 2022.
Read more insights from our latest high-cost claimant report.
KEY AREAS OF FOCUS
How Lockton helps healthcare clients improve alignment & manage costs while attracting talent
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Making better use of in-house and domestic care services for plan members
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Improving how pharmacy services are purchased and distributed
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Getting more value from care management programs and point solutions
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Aligning benefit strategies with internal care delivery capabilities and payer partnerships
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Matching benefit offerings to market position, mission, and organizational values
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Connecting rewards strategy to workforce planning goals across staffing models, personalization, and business lines
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