Executives at Bailey Lauerman & Associates, an advertising agency in Lincoln and Omaha, Neb., see big value in offering a vision plan to its employees.
Though they’re paying for coverage of a single dental and vision plan for its 60 employees, they say it’s a small price to pay for keeping — and attracting — happy and healthy employees.
“We use it as a recruiting tool,” says Spencer Peery, the firm’s business manager. “We offer some of the best benefits at a competitive price. These benefits keep our employees healthier. They use dental and vision coverage almost as much as they use health insurance, for both prevention and general care.”
Bailey Lauerman & Associates offer a single dental and vision plan and pays for employees’ coverage. Workers pay $20 a month to add their families to the plan.
“It’s worth it to us to be able to offer that benefit. It’s one of our costs of doing business and keeping employees happy,” Peery says, adding that the company plans to continue offering the same, standalone vision benefit, even when coverage bought on an insurance exchange becomes another option.
Peery’s firm is simultaneously unusual and very common: unusual in paying the entire premium for employees’ vision coverage, but common in planning to continue the benefit after the Patient Protection and Affordable Care Act comes fully into effect.
An increasingly voluntary benefit
Twenty years ago, many employers began offering workers vision coverage, part of a continuing effort to recruit and retain the best people. Back then, employers typically picked up the entire premium, at least for the employee and sometimes for employee families are well.
Now, by contrast, firms are moving toward voluntary enrollment and an arrangement that has employees participating in at least some of the costs.
“That’s a trend we’ve seen accelerate over the last several years,” says Melody Healy, senior vice president for product strategy and integration at VSP Vision Care in Rancho Cordova, Calif. “Employers are looking for options. They want to be able to provide some level of benefit, but they may not be able to afford to cover the whole cost.”
The reason the employer can’t afford to pay the whole bill, industry experts say, is typically that it has already spent so much on employee medical insurance, which has seen steep, persistent cost increases.
But many firms are still willing to pay as much as they can for vision, because it helps them stay attractive to potential and current employees, says Shannon Enders, a partner at Lakeshore Employee Benefits in Norton Shores, Mich.
“You want to attract and retain people, and if you have a $1,000 deductible on your medical plan, you might as well have a $1,500 deductible and a vision plan,” he says. ”That’s more attractive to employees.”
Vision coverage also is important as a part of overall medical wellness programs, adds Karen Gustin, senior vice president for group field sales, national accounts, and broker blocks at Ameritas Life Insurance Corp., which is based in Lincoln, Neb.
Weight-loss and smoking-cessation programs can be a tough sell, she notes, “because it can seem like the employer is meddling. No one wants to hear that they’re fat or should stop smoking.”
An opportunity to get one’s eyes checked, on the other hand, sounds and feels more like a chance for personal wellness — one that comes without any sense that the employer is overstepping its bounds.
No one does good work when she can’t see, of course, so vision coverage boosts productivity. Vision care as part of overall wellness also benefits employers’ bottom lines, because vision exams can spot diabetes, high blood pressure, cancer, and various other ailments before they become life threatening — and more expensive.
That helps self-insured companies keep direct costs down and also helps fully insured firms reduce premium increases.
Voluntary and popular
Despite voluntary benefits’ reputation for being a lot of work for little return, voluntary vision coverage is typically a popular product.
“We see very solid sign-up and participation in our plan — 35 to 50 percent participation,” says Kevin Hilst, who is senior vice president for sales and account management at Eye Med in Mason, Ohio. “Consumers see value in what we offer.”
In fact, Hilst says, employees are even willing to pay more for an upgraded product. “We’ve gone through claims history to find that consumers will pay more for greater value,” he says.