Five reasons worksite benefits matter more than ever
Post-ACA, it’s time to look closely at the new insurance landscape
What does it mean to be functioning in the post-Affordable Care Act era? If you’re an employer, one thing it should mean is that it’s time to look closely at the new insurance landscape. Are there strategies that could help you adapt better? A great place to start is with worksite benefits. Sometimes called supplemental health or voluntary benefits, these are plans that employees pay for typically via payroll deduction. They can help create a more appealing benefits package for employees because they go beyond typical healthcare insurance.
You may already be aware of a certain well-known insurance company (represented by a quacking water fowl) that offers plans like these. But what you may not realize is just how many other avenues exist today for worksite benefits. In the last several years, this market has expanded significantly. And that’s actually great news for employers. In fact, if you’re an employer who hasn’t given serious consideration to offering worksite benefits before, there’s never been a better time. Here are five reasons why.
1. Harness the power of choice
Once considered niche products, worksite plans have gone mainstream in recent years, with most major medical and ancillary carriers offering their own suite of similar products. That means you aren’t locked in to offering just one kind of benefits plan to your employees. Rather, you can mix and match to find the carrier with the best product and process solutions to meet your organization’s needs. Also, you can gain billing and rate advantages on non-worksite products: some carriers offer rate and renewal considerations for your core benefits when you partner with them for worksite offerings.
2. Reap the rewards of the broker model
The growth of the worksite benefits market has meant a new wave of reputable carriers getting involved. These carriers rely entirely on the traditional broker-agent distribution model of employee benefits. This benefits you because, unlike the direct-to-employer model, a broker works with a variety of carriers, can advocate for you and will help you navigate the complexities of worksite benefits. With support like that, you’re much more likely to select a carrier that fits with your overall benefits strategy. Typically, a direct-to-employer carrier isn’t involved enough to recognize the ways that a worksite plan can contribute to the bigger picture of your benefits offering.
3. High-deductible health insurance + worksite plans = fuller coverage
In the past, worksite plans were typically intended to help employees protect their wallets from unforeseen medical expenses. Today, worksite benefits like accident, critical illness, and hospital gap pair especially well with high-deductible health plans. Consider that two-thirds of Americans have reported that an unforeseen $1,000 expense would cause significant financial hardship. In light of statistics like that, worksite benefits can play an important role in protecting employees from the risks imposed on them as healthcare costs continue to evolve—and rise. Gone are the days of nit-picky reimbursement plans that required insureds to validate every claim dollar; most plans today are indemnity-based.
4. Go beyond traditional term life
Including permanent life insurance plans as a worksite benefit not only buoys a traditional term life plan, but can also give employees access to long-term care benefits, which are scarce in today’s benefits landscape. Many permanent life policies offer riders that allow insureds to draw on the value of the policy as a way to fund their long-term care needs.
5. Create more satisfied employees
Research shows that employees who are offered voluntary benefits report greater satisfaction with their overall benefits package, and this translates into nearly identical levels of employee satisfaction with their employer. Closely related, employees who rate their benefits education highly also have a more positive perception of their employer as a whole. (See below for more on that education component.)
Getting a worksite benefits campaign to soar
If you do indeed decide to launch a voluntary worksite benefits campaign, make sure you communicate the details effectively right from the start. Most carriers offer multiple methods for communicating about—and enrolling in—these types of plans. Why is that relevant? Because your workforce likely has Millennials, Gen-Xers, and Boomers. They differ widely on how they prefer receiving and interacting with information; you’ll want to maximize your options so you can reach everyone.
Finally, don’t forget that you can leverage a new worksite benefits roll-out to implement a bold education campaign on your organization’s overall benefits, all at little to no direct cost. By having the right carrier, a reliable broker partner and a smart enrollment process in place, you can create a strong benefits education plan, one that will better meet the needs of your organization and your employees.
This information was featured in a BizInsights article, published on August 3rd, 2016.