Why Voluntary Benefits Are More Relevant Now Than Ever
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Health care reform and increasing health care costs continue to drive demand for voluntary benefits — and for good reason. As the cost of health insurance rises, employers continue to struggle to control their company’s health care expenses. Many have already passed more of the premium costs to employees and have increased deductibles, copayments or out-of- pocket limits. For many organizations, voluntary benefits may help solve a number of concerns and challenges that have surfaced during this time of health care financial insecurity.
Voluntary insurance policies, including critical illness, short-term disability, accident, dental, life insurance and more, pay the policyholder directly for unexpected costs associated with serious illness, injury or loss. Since many of these costs are not covered by major medical insurance and families often do not have extra cash for these emergencies, voluntary insurance plans help provide a safety net to protect the policyholder’s assets. Often, having these policies can save individuals from out-of-pocket costs, unexpected debt and may even prevent bankruptcy – helping them focus on getting better and getting back to work.
Soften the Impact of Rising Health Care Costs Health care reform has also caused many companies to brace for additional increases in their expenses. To reduce the burden on corporate bottom lines, benefits decision-makers are often forced to pass larger portions of these increases onto their workforce, as well as increase deductibles, copayments and out-of- pocket maximums. Unfortunately this can result in a workforce unprepared for higher expenses, and growing resentment toward their employer. In fact, 47 percent of workers would feel more negatively about their employer if they shifted an increasing portion of health insurance costs to them. Most employees (46 percent) are not very/not at all prepared to pay for out-of-pocket expenses related to an unexpected illness or accident, and 28 percent are only able to pay less than $500 for themselves or family members for out-of-pocket expenses. The result is that employees are faced with tough decisions, and 36 percent would have to borrow money. When an employee faces financial difficulties, an employer feels the impact as well in the form of decreased job performance, absenteeism and dissatisfaction. More than half of the country’s employers provide voluntary insurance, tapping into a remarkably easy way to look after the well-being of their workforce through the following: CUSTOMIZED BENEFITS PACKAGES: Employees can select coverage relevant to their circumstances and build a benefits plan tailored to their specific needs. The Answer is Voluntary Benefits Adding voluntary insurance products not only increases an employee’s insurance options, but also helps give policyholders peace of mind and financial security. In the event of sickness or injury, policyholders receive cash benefits that are often used to help pay for daily living expenses, such as rent, gas, groceries, babysitting and other necessities, or to help cover deductibles and copayments. Although aspects of health care reform are in effect, most of the new law will be phased in over the next several years. Voluntary options can be counted on to help soften the impact of the inevitable cost-shifting and rising out-of-pocket costs that are part of the current health care landscape. |
