Are employers and employees missing the benefit of voluntary products?
While the number of high deductible health plans being offered continues to increase, creating gaps in coverage for employees, the utilization of voluntary benefits to fill these coverage voids has not kept pace, new research finds. Advisers can work with employers to better communicate the benefit of these products to increase engagement.
Fifty-eight percent of employers with 500 or more employees in 2015 offered HDHPs as a plan option, up from 51% in 2014, according to a 2015 bswift Benefits Study. Yet, voluntary benefits such as critical illness, hospital indemnity and accident insurance, are not regularly being offered alongside HDHPs, according to a new survey released by Benefitfocus, a Charleston, S.C.-based HR and benefit technology solutions company.
While these products generally assist employees with financial hardships only 36% of employers surveyed by the company offer at least one of these three gap products, with approximately 10% offering all three. And, only 14% of employees are enrolling in them, the company’s 2016 State of Employee Benefits study finds.
Communication is key to encourage employee participation in voluntary benefits, the study says. Experts say the timing of those communications is also important.
“You have brokers out there that do make the recommendation of – ‘let’s offer these products but let’s not offer them in conjunction with core medical benefits, let’s offer them as a standalone voluntary benefit,’” says Shan Fowler, senior director of product strategy with Benefitfocus. Unfortunately providing the products in an off-cycle timeframe reduces the number of participants, he adds.
“In our partnering with brokers [we want to] make sure to have these [options] during the open enrollment period, because employees then have the opportunity to understand how these products complement their medical coverage,” he adds.
“To an adviser I would say it’s a new day,” notes Jeff Oldham, vice-president at Benefitfocus. “If you're an adviser and you focus on medical and perhaps these benefits are not well known, in this new day, offering the two is what is best going to help your client and your employee.”
"If you're an adviser and you focus on medical and perhaps these benefits are not well known, in this new day, offering the two is what is best going to help your client and your employee.”
Advisers, Oldham says, can also use “the power behind an active enrollment.” Which, he says encourages employees to use employer-based tools to evaluate how voluntary benefits coincide with their medical benefits.
Fowler agrees that using technology as a communication and enrollment too, can help increase participation. Using technology can “amplify” what is available to employees, he says.
“As opposed to just telling people they should have critical illness, you can show them the value through technological tools,” he says.