More than four in 10 companies will reduce private healthcare provision for staff if costs continue to rise, with more than half citing stress as a significant problem.
In a new survey, 44 per cent of firms warned eligibility for healthcare will have to be cut if costs increased, with a further 40 per cent admitting the benefits have not been managed successfully.
The issue of rising expense presents a dilemma for companies as 80 per cent believe curtailing private healthcare could damage recruitment and retention.
Furthermore, 90 per cent of respondents thought providing healthcare for staff was a fundamental part of being a caring employer.
Increased Government spending in the NHS has done little to help firms improve employee wellbeing, with just 16 per cent claiming the additional investment in the health service will reduce pressure on business.
The survey of 100 companies by consultants Mercer also found that 51 per cent of bosses recognised stress-related illnesses as a significant issue.