Experience the Benefit of Voluntary Benefits
Dec 10, 2009
Experience the Benefit of Voluntary Benefits
As healthcare costs continue to rise, so has the demand for voluntary benefits. Since many employers find it increasingly difficult to provide employees with a complete benefit package, and employees need new ways to supplement their core benefits, voluntary benefits have become an ideal solution. In this article, Janet Buzil of Trustmark Voluntary Benefit Solutions, walks through the advantages of voluntary benefit solutions as well as what employers should look for in a voluntary benefits carrier.
Voluntary Benefits on the Rise
Voluntary benefits — benefits where employees pay 100 percent of the premiums through payroll deduction — are more popular than ever. Sixty-four percent of employers offer at least one voluntary benefit, according to Eastbridge Consulting Group Inc., a financial services consulting firm. Eastbridge, which tracks insurance sales, said voluntary products sales have more than doubled since 1997.
Advantages of Voluntary Benefits
The drivers to the increasing popularity of voluntary benefit solutions are their unique advantages. One of these advantages is the absence of direct costs to the employer. With voluntary benefits employers can provide their employees access to the additional benefits they need – without taking on additional premium charges for the company.
Voluntary benefit solutions will enhance your existing benefits program. You can offer coverage options that complement your employer-paid benefits and give your employees access to benefits the company could not otherwise afford. A broader array of benefits, provided on a voluntary basis, enables employees to choose coverage that meets their individual needs, and strengthens your overall benefits package. A stronger employee benefits package that can help attract and retain valuable employees is another key advantage.
By offering voluntary benefits to your employees, you are doing more than providing them access to additional coverage. You are giving your employees access to benefits at group rates, which are traditionally much less expensive than individual rates. In addition to helping your employees take advantage of lower premiums, with voluntary benefits your employees can also take advantage of simpler underwriting requirements, compared to individual insurance plans. And in many cases voluntary benefits are offered guaranteed issue, meaning there are no health questions at all.
Adding Up the Benefits
Voluntary benefits appeal to both employer and employee needs.
Employers benefit from:
• Increased expense control in the face of rising benefit costs;
• Additional benefits for employees at no extra cost; and
• An important tool for attracting and retaining valued employees.
• Opportunity to access a broader array of benefits
• Freedom to choose benefits that best suit their needs
• Affordable premiums
• Portable coverage
• Easy enrollment process
• Convenient payroll-deducted premiums
Choosing the Right Carrier
Because the voluntary benefits market is growing and evolving, it is important to be aligned with an industry leader. Employers should insist on documented service measurements before they choose a carrier for their voluntary benefit package.
Choosing the Right Voluntary Benefits Program
When you’ve made the decision to implement a voluntary benefits program, you’ll need to evaluate which voluntary benefit plans are most beneficial to your employees. For example, you and your employees may be concerned about their need for permanent life insurance and the difficulty of funding long term care. Universal Life can help employees prepare for the future by providing financial security for their family, and helping to protect them against the high costs of long term care.
Another example to consider is the growing trend and movement toward implementing HSA medical plans with high deductibles. In these instances, introducing a Critical Illness plan can be an ideal solution to bridge the gap in coverage. Critical Illness plans pay a lump sum benefit upon the first diagnosis of a covered condition. Covered conditions vary by carrier, but nearly all carriers include heart attack, cancer, and stroke in their plans. Some Critical Illness plans cover renal failure, major organ transplant, paralysis, coronary artery bypass surgery, ALS, and blindness. Some new covered conditions by some carriers is Occupational HIV, specifically for employees such as healthcare workers, police, and firefighters who face the occupational hazard of contracting HIV daily.
Critical Illness benefits are intended to provide security for many expenses not covered by basic medical insurance, such as:
• Family income replacement during recuperation
• Medical insurance deductibles and co-pays
• Childcare and housekeeping expenses
• Out-of-network and experimental medical treatment
If you have implemented an HSA plan, you may be interested in offering a voluntary Critical Illness plan. Some new Critical Illness plans include an employer-funded base benefit, with a voluntary employee-paid buy-up. In this scenario, for a minimal charge, the employer can contribute a base benefit, such as $5000 benefit to help employees fund the high deductibles in their HSA plans. Employees can then voluntarily buy-up another $5,000 to $95,000 in benefits. Providing a base benefit is at the complete discretion of the employer.
Voluntary benefit programs can easily be customized for your company. Carriers offer several voluntary benefits. The key to implementing a successful voluntary benefits plan lies in reliable administration.
Experience Matters—Check For Administrative Reliability
Finding partners with decades of experience in providing quality voluntary employee benefits is key. Due diligence is of the utmost importance. You’ll want to be sure to look for exceptional front-to-back product and service delivery. Key components include complete enrollment support through professional enrollment firms and trained benefit counselors, toll-free number supporting services for employees; focused, proven case implementation/management process; and online access to post-enrollment case data and billing information.
A supportive, professional approach with one-on-one and group meeting options is key to the success of a voluntary products enrollment. Many times you can have an electronic system specifically designed for enrolling Universal Life, Critical Illness, Disability Income and Accident benefits in a one-on-one environment. Convenient group enrollment meetings are an option for Group Critical Illness and Short Term Disability. Look for an Internet enrollment system that allows Human Resources staff or employees to enroll new hires and provides post-enrollment support to employees who are in remote or small locations.
With the complexity involved in setting up and managing a case, employers should seek a provider who will assure them the process will run smoothly.
Consolidated, Internet Billing
Excellence in billing is essential for a voluntary benefits program. Unfortunately, billing is a common stumbling block for carriers. Billing errors are one of the top employer complaints related to voluntary benefit programs. Therefore, it is critical to perform the due diligence necessary to assure that the carrier or third party-administrator you choose for your voluntary benefit billing has the flexibility to handle the unique requirements of payroll-deducted products.
A major benefit of the consolidated billing process is the ability to combine multiple products from multiple insurance carriers in one or more payroll deduction slots. This eliminates the need for employers to reconcile and pay multiple voluntary program billings that appear at different times each month. It is also beneficial for employers who have a limited number of deduction slots with only one available for voluntary benefits.
Janet Buzil joined Trustmark Insurance Company in 1997 and is currently Second Vice President, Marketing and Product Management, for Trustmark Voluntary Benefit Solutions. She earned a bachelor’s degree from Columbia College and a master’s degree in Marketing, Finance, Management and Strategy from the Northwestern University Kellogg Graduate School of Management.
About Trustmark Voluntary Benefit Solutions
Specializing in voluntary benefits including Life, Critical Illness, Disability and Accident, Trustmark Voluntary Benefit Solutions answers coverage needs for employees nationwide, backed by more than 95 years serving this market.
Trustmark Voluntary Benefit Solutions is a division of Trustmark Insurance Company, a leading insurer and benefits administrator which is licensed nationwide to offer medical, managed care, dental, disability and life insurance products and benefits administration services to employer groups and the voluntary market. With more than 90 years of experience in voluntary benefits, Trustmark is extremely well positioned to provide the information employers need to make knowledgeable decisions about enhancing their voluntary benefit plan.