Customization in a One-Size-Fits-All Market
What are most people looking for in their health benefits? Coverage that will truly support their specific health needs.
The challenge, if you choose to accept it, is figuring out how to provide that kind of support with today’s one-size-fits-all primary plans that dominate the market.
Quick Definition Time
One-size-fits-all plans: Health plans that provide the same coverage to all employees despite the fact that needs may vary.
What employers need is a way to achieve benefits customization.
Why?
- Doing so helps tailor benefits to their wants and needs, as well as to the wants and needs of specific classes of employees.
- It helps provide employees with benefits they will actually use rather than providing too much or too little with one-size-fits-all plans.
- Offering benefits that employees truly value will help attract, retain and engage talent.
What are employees saying about customized benefits?
- Over 40% of workers said their company loyalty would increase if their benefit options were customized to meet their individual needs.
- More than 75% of employees said they wanted more variety with their benefits
- 80% said they want customized benefits that are tailored to age and individual needs.
How is this possible?
- Voluntary Plans: These are different types of health insurance, like hospital indemnity or cancer only plans, that an employer can offer and an employee can opt into based on their needs. These plans typically only cover a specific type of expense, like hospital bills or cancer treatment expenses.
Example: A pregnant woman knows she will incur hospital expenses in the coming year, so she opts into a hospital indemnity plan.
- Cafeteria Plans: Based on Section 125 of the IRS code, employers can provide this benefit which allows the employee to contribute income into a pre-tax account to be used for medical expenses.
Examples: FSAs, HSAs
- Excepted Benefits: There are 4 categories of excepted benefits that are excepted from ACA, including nondiscrimination rules, which means these plans can be offered to select employee classes.
Example: Ultimate Health, a supplemental healthcare insurance plan that can be layered on top of the primary plan to add additional coverage for a select group of employees. This is especially helpful to offer to hard-to-recruit-and-retain individuals.