Employee Benefits Trends In Retail Industry 2018

Enrollment Data: Retail Employees Bear an Increasingly Heavy Health Care Burden

Retail employees probably wish their doctors would offer a '30 percent off' or 'buy-one-get-one-free' deal of their own right about now.

As employers in the retail industry look to keep benefit costs under control, health care is getting more expensive for their employees. And while voluntary benefits offer additional financial protection for the majority of these workers, there remains a long runway of opportunity for health spending accounts to help them manage their out-of-pocket liabilities.

Here's a more in-depth look at benefits in the retail industry according to Benefitfocus' State of Employee Benefits 2018 Industry Edition, based on actual enrollment data from large employers using the BENEFITFOCUS® Platform:

HDHPs are getting more prevalent—and more expensive—in the retail industry.

Since 2016, the share of retailers offering at least one HDHP has increased from 55 percent to 76 percent, which is slightly higher than the current overall HDHP offering rate on the Benefitfocus Platform (70 percent). Over that same span, HDHP participation among employees has increased from 27 percent to 40 percent—also higher than the current overall HDHP participation rate on the Benefitfocus Platform (35 percent).

Meanwhile, the premiums that retail employees are having to pay for these plans (which of course already carry high out-of-pocket costs) have risen substantially. For example, the average annual employee premium contribution for a single-coverage HDHP has increased nearly 20 percent since 2016, from $980 to $1,147.

Retail employees are saving relatively little for health care.

HSAs offer a powerful way for workers to fund the out-of-pocket responsibility of an HDHP using tax-free dollars. But in the retail industry, these accounts are getting below-average contributions from both employers and employees. Retail employers contributed less than $350 to single-coverage HSAs for 2018—40 percent below the Benefitfocus Platform average. And employees in retail contributed approximately $1,140, which falls 20 percent shy of what their peers are doing.

The majority of retailers offer voluntary benefits to supplement coverage for employees.

The good news is that the retail industry has embraced the power of voluntary benefits to help provide employees a financial safety net in the event of any unexpected medical situations.

For 2018, 56 percent of retail employers offered at least one voluntary accident, critical illness and/or hospital indemnity plan. That’s up from 43 percent in 2016, putting the retail industry ahead of the curve when it comes to these offerings. Retail employees are also slightly more likely than their peers to elect one of these products (28 percent versus 25 percent participation, respectively).

See additional industry-specific benefit trends in the full State of Employee Benefits 2018 Industry Edition.