Health insurer Aetna will increase the minimum hourly wage for workers as of April 1 to $16 an hour and enhance medical benefits to lower out-of-pocket costs for employees, the company announced Monday.
The wage change will impact 5,700 of Aetna’s 48,450 employees, resulting in an average 11% increase and as high as a 33% increase.
Employees in areas that will benefit the most from the wage hike are largely consumer-facing positions and include customer service, claims administration, plan sponsor eligibility, and billing.
The enhanced medical benefits changes will help lower out-of-pocket healthcare expenses for some of Aetna’s U.S. employees, according to the company. It estimates that the enhancements could affect 7,000 employees and result in $4,000 in savings per employee.
The changes will cost Aetna approximately $14 million in 2015 and $25.5 million in 2016. It has projected 2015 operating revenue of $62 billion and operating profit at $2.4 billion, according to the Wall Street Journal (WSJ).
Mark T. Bertolini, the insurer’s chief executive officer, told WSJ that one reason for the wage hike is the changing structure of insurance markets, which are selling more policies to individuals. “We’re preparing our company for a future where we’re going to have a much more consumer-oriented business,” he told the publication, adding that he wants “a better and more informed work force.” He added that the company hopes the move will lower turnover and attract high-caliber job prospects.
In a statement to the Hartford Courant, Bertolini said the wage hike is a chance for the insurer “help re-establish the credibility of corporate America."
"I firmly believe that companies can 'do well by doing good.' With these investments, we are leaning into the recovering economy and working to bring everyone along instead of just a few."
The company joins as small but growing list of U.S. firms that are announcing wage hikes above the federal minimum wage, including Starbucks and the Gap.