Insurance deductibles are getting higher, and this means people will have to think differently about how they consume healthcare. The simple truth is that most folks are unprepared to do that. In addressing this dilemma, employee benefits programs have never been more (potentially) valuable. But how do organizations convey this value to ensure that employees have the coverage they need to be happy, healthy and productive?
Employer medical costs are out of control
As healthcare inflation continues to outpace general inflation, employer costs could double over the next five to seven years. Combine that with the Affordable Care Act’s looming Cadillac Tax, and organizations have no choice but to reduce spending now. And this means shifting more financial responsibility to employees in the form of higher-deductible health plans in a defined contribution model.
Employees are vulnerable
Unfortunately, the vast majority employees are not in a position to take on this responsibility. A few stats 1:
- 49 percent of employees have less than $1,000 to pay for unexpected medical expenses
- 53 percent would borrow from 401(k)s or credit cards to cover those costs
- 66 percent wouldn’t be able to adjust to the cost of a serious injury or illness
Voluntary Benefits (Accident, Critical Illness, Long-Term Disability, etc.) can go a long way in providing financial security in the new world of healthcare consumerism. In order for that to happen, though, employees need to have more visibility into their personal need for such products. Currently, four out of five employees are choosing the wrong coverage for their specific situation, and that means higher costs for them and for their company. 2 It’s up to HR professionals to fix this. But how?
A Blueprint for Benefits
Think about creating a benefits package like constructing a home. In this analogy, a consultant acts as the architect who puts together a strategy. Insurance carriers act as the suppliers who provide materials. And a technology company is the contractor who delivers the project. As you may know from experience in homebuilding, these three roles are rarely in sync, and it can be frustrating. Similarly, when it comes to building a benefits package, viewing the process in separate pieces causes problems because each piece only has expertise in its own part of the solution.
To really address the dilemma their employees are facing, organizations need a way to bring all three pieces together in one solution that can:
- Align voluntary benefits strategy with employer goals
- Provide access to products that fill gaps in coverage
- Guide employees to smart decisions with an intuitive enrollment experience
When consulting, products and technology are working together, organizations get the convenience, consistency and customization necessary to protect their employees.
Learn more about how the new Benefitstore from Benefitfocus provides a complete solution to help companies build a benefits package their employees need, understand and appreciate.
Hear more on this topic from our thought leaders at the Health and Benefits Leadership Conference, April 8-10 in Las Vegas.