The number of employers offering high-deductible health plans as the sole health plan option is on the rise, and with it rising costs for employees. Workers who incur expensive medical bills are increasingly having a difficult time paying off those initial expenses.
In an effort to offset such out-of-pocket exposure, a new supplementary health benefit startup, MedPut, is offering a benefit to pay medical bills without depleting savings or incurring debt through discounted medical bills using a 0% APR loan system.
Every employee would receive interest-free financing irrespective of credit score, and any medical expense, including dental, vision, laboratory, pharmacy, consultations and hospitalization, is covered.
Stefan Sharma, founder of MedPut, says this benefit could be highly beneficial to any benefit broker who handles clients with 500 or fewer employees or works with blue-collar businesses that may have low-level income workers.
“[Brokers] are our primary distribution channel,” Sharma says. “We are constantly communing with brokers on product features, keeping them updated on how we work with administering the benefit and how we work with payroll and benefit admins.”
At least 90% of brokerage firms with clients handling 500 or fewer employees report cost increases at most recent health plan renewals, according to data gathered by MedPut. Additionally, 54% of brokerage firms reported that insurance cost increases have resulted in higher deductibles, and by 2018 50% of all employers will only offer HDHPs as their main healthcare plan.
Sharma says offering this supplementary benefit is another way brokers can strengthen their relationship with their clients. It encourages employees to receive treatment for minor problems before they develop into larger claims, he says.
Covering the small stuff
“I think a lot of employers are considering having the only plan available for their employees [be] a high-deductible health plan, and this benefit could help ease that transition very dramatically,” Sharma says. “Our referred employee per month charge is $2 to $4, depending on employer size and employee demographics, but for an employer that is a far more pliable cost than owning the risk themselves or buying supplemental gap insurance.”
Sharma adds that this benefit can be paired with all consumer-driven health plans and can act as a stand-alone or complement HSAs or medical gap insurance. While the financing benefit acts as a supplement to major medical plans, Sharma says MedPut could be the beginning of a new health plan offering for employers with 50 or fewer employees.
“We cover the small stuff. We encourage people to get the primary care treatment to prevent larger things from happening,” Sharma says. “We have talked to a couple of CEOs about rolling this out to their employers with less than 50 employees who are on the fence about purchasing group-health insurance, because they don’t have to.”
MedPut plans to launch its beta to customers this summer; however, Sharma says any broker who has a client that is interested in their product can contact them and have the benefit made available at the employer’s will.
“We know our sales cycle will be contingent upon open enrollment cycles, because that’s when employers tend to actively think about adding benefits, but there really is no specific entry point,” he says. “The employer can contact us at any time and we will get it rolling.”
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