We know that health care reform is coming, in some form or another. With many mandates still pending, business owners and their benefits administrators alike are spending an inordinate amount of time and effort analyzing – and agonizing over – which direction to take with medical coverage, leaving them with little time to devote to other benefits, much less the earnings to pay for them.
Astute agents can ease employers’ apprehension by helping their clients rediscover the value of voluntary benefits. Dental and vision plans have been popular for years, and supplemental benefits such as long term care insurance, critical illness, and accident coverage are increasingly demanded by employees coming to grips with their extended family’s health needs. With employees willing to pay for such benefits out of their own pockets, employers now have much-needed resources to improve retention and satisfaction, despite the uncertainty with health care and the economy in general.
Simple to understand, voluntary benefits can also be easy to enroll and administer once the employer has the proper tools. Agents, while looking for alternate ways to enhance their clients’ employee relations efforts, are presenting, and educating them about, tools and services that make it easy for employers to offer and manage their voluntary benefits.
Employers face the unknown
According to “Health Care Reform,” a May 2010 Towers Watson survey of company executives on health care reform, “the overwhelming majority (90 percent) of employers believe health care reform will increase their organization’s health care benefit costs.” Eighty-eight percent of respondents already plan on passing increased costs to employees. While nearly half of the respondents expect it will not affect their total rewards package, 35 percent expect that health care reform will have a negative effect on their ability to provide competitive benefits.
It’s no wonder employers and their benefits administrators are preoccupied. In most cases, they are waiting to see whether their current health plans can be “grandfathered.” At the same time, they are reexamining their major medical offerings for the future and hoping that any multi-year implementation plans or heavy cost shifting already in the works will not result in the mass defection of employees.
These concerns have left employers with little time or energy to study their nonmedical benefits offerings, much less package and administer them. Smaller employers may not even have a benefits staff to sift through reforms and other benefit issues for the owners.
Yet supplemental benefits, including voluntary benefits, can be real difference-makers to employees. They can include:
- Dental and vision plans: Highly sought-after coverage that typically leads to higher employee satisfaction and retention.
- Life and disability insurance. Income replacement and “paycheck protection” coverage, which can be coupled with concierge-type features not typically included in health plans.
- Critical illness and accident coverage. Products that feature lump-sum cash payments to help cover such items as out-of-pocket medical expenses, aftercare, or treatment related to serious illnesses or injuries; make up for missed mortgage and car payments; or help cover a spouse’s lost wages on the days they take the primary insured for treatment.
Employees tend to place a high value on such additional benefits that their employers have chosen to offer. This is partly because employees tend to lack the time, knowledge, or means to study benefit options outside the workplace, and because they have the convenience of payroll deduction for premium payments, as well as employer-negotiated group premiums, which are often lower than individual rates.
While voluntary benefits are employee-paid and employers’ expenses are minimal, the products’ real value lies in their immediate and tangible benefit to employees. What else explains the high penetration and rate of re-enrollments in group dental and vision plan membership, or the meteoric rise of critical illness coverage enrollment over the last few years?
What can you do?
So what can agents do to help employers (and employees) discover and understand the value and importance of voluntary benefits? Simply, agents must deliver the right message through the right medium – at the right time, of course.
Showing clients how these products solve real problems can help boost the number of enrollees, and administrative tools that make it as easy as possible for employers to offer and for employees to sign up and access their benefits are also critical.
What types of services should you look for?
- Paperless enrollment. Whether online or over the telephone, paperless enrollments simplify the process for employers and their employees, especially for employers with multiple locations or offsite employees.
- Personal touch. Although online tools and software-as-a-service are growing in popularity, especially among younger employees, many people still prefer access to a real person who can answer important questions. With live support or extended customer service hours, some carriers can still offer agents and their clients more of a human touch. It’s important to partner with carriers that understand the importance of working with members on their terms, whether it’s online, via paper, or person-to-person.
- Takeover processes. It can be stressful and time-consuming for employers to switch carriers. Finding a carrier with a simple, seasoned takeover process saves time and money, and helps prevent needless aggravation.
- Integration/consolidation of services. It can be frustrating to figure out which number to call when clients have questions or concerns. Carriers that offer enrollment services, billing, and customer service all in one location have a unique selling point. When all the carrier’s products and lines of coverage can be accessed through one contact number and one website, it becomes even easier to offer the benefits.
- Service assistance for employers. Administrators want tools that make it easy to manage their group benefits. Look for a carrier that offers an integrated website, allowing administrators to print ID cards, manage employee information, add or delete employees, view billing and payment history, and access needed forms and documents.
- Service assistance for employees. Employees are always looking for easy access to their benefit information. Most carriers now offer employees Web tools that allow them to view benefits and claims and download any forms and documents they may need, saving time for employees and benefit administrators alike. Look for such additional features as provider search tools, health and wellness information tools, the ability for members to print their own ID cards, and, with the explosion in smartphone and tablet technology, mobile-enabled information and services.
Members won’t use every feature, but you should look for carriers who will best serve your clients’ needs on their terms.
Voluntary benefits are not just popular – they are valuable for employees. But they are just as valuable to employers, helping them add benefits that can attract and retain employees without adding to the bottom line. By working with a well-positioned carrier that offers multiple valuable benefits and tools and services that make it easy for employers to offer and manage the products, sharp agents can move from a place outside of their clients’ health care reform strategy to a counselor’s seat at the executive management table.
Erich Sternberg is president of Starmount Life Insurance Company and its sister company AlwaysCare Benefits Inc. He can be reached at 888-729-5433.