Offer Voluntary Health Benefits to Be a Small Business Hero

Voluntary health benefits are like the underdog of an employee benefits package because major health insurance is the main attraction. But we all like to root for the underdog. The underdog has value that makes it a contender for the spotlight. You can be a small business hero by capitalizing on the value of voluntary benefits by using it to help:

• Defend your small business from the competition,
• Protect employees with additional health coverage, and
• Save employees from medical debt and financial burden.

Defend Your Small Business From the Competition

Competition isn’t a bad thing. Competition makes businesses strive harder to be the best. Being the best involves having the best talent on your team. And offering group health insurance is a common way companies try to recruit and keep the best employees. But in today’s competitive market, offering health insurance alone may not be enough, especially for small employers. Why? Because small employers are in fiercer competition with large companies—98 percent of companies with 200 or more employees offer group health insurance. In comparison, health insurance is offered by 56 percent of firms with 3-199 employees and by 47 percent of firms with 3-9 employees.

To better compete—in essence, defend your small business from losing out on top talent—you may need to “bulk up” your employee benefit package. This can be done through voluntary health benefits.

Voluntary Benefits Definition

Voluntary health benefits, also known as voluntary health insurance and supplemental health insurance, are health plans that provide additional protection because they’re used to fill the gaps in major medical insurance. A major medical plan provides coverage for general healthcare, but it doesn’t cover certain types of treatment, such as a root canal. Think of major medical like homeowners insurance that covers your whole house, and voluntary health like flood insurance that covers a specific type of home damage.

Also, major medical insurance doesn’t pay for everything. If an employee is admitted to the hospital for instance, a major health plan usually provides coverage only up to a certain dollar amount, which could leave the employee with a huge bill. Paying for out-of-pocket medical expenses or getting treatment like a root canal are some of the things that a voluntary health plan can help employees pay for.

Types of Voluntary Health Insurance

There are several examples of voluntary benefits. These include:

• Vision
• Dental
• Accident
• Hospital confinement
• Critical illness/Cancer
• Disability
• Long term care
• Fixed indemnity

Protect Employees With Additional Health Coverage

Of all the types of voluntary benefits listed, vision and dental insurance are the only two that deal with receiving medical care—the rest all pay cash benefits directly to the insured to help supplement the expenses of dealing with an injury or an illness. Supplemental vision and dental insurance covers things that health insurance doesn’t cover. Health insurance typically covers medically necessary care, such as treatment for an eye injury or infection, or a knocked-out tooth. But it usually doesn’t cover routine, preventive, and cosmetic dental and eye care. These are some of the things that a voluntary dental and vision plan covers:

How Vision Insurance Can Help Protect Employees’ Health

Studies show that people with vision insurance are more likely to get eye care checkups and that those who got an eye exam the year before reported better vision. By giving employees access to vision insurance benefits, you’re helping protect the health of their eyes. Not only that, you’re helping save their lives because a comprehensive eye exam can detect signs of serious medical conditions. Here are some of the conditions that a comprehensive vision exam can detect:

• Hypertension: This can be detected if the eye vessels show bleeding and kinks. Hypertension or high blood pressure is often called “the silent killer” because some people show no symptoms. This condition can lead to other health problems like kidney damage, stroke, and peripheral artery disease.
• High cholesterol: Yellowish rings around the cornea are a sign of this condition, which can lead to heart disease and stroke.
• Cancer: Abnormal tissue growth on eyes can be a sign of cancer.
• Tumors: Different sized pupils and droopy eyelids can be a sign of tumors in the body.
• Thyroid disease: An overactive thyroid can cause the eyes to bulge, which is a sign of Graves’ disease.
• Autoimmune disease: Inflammation in the retina is usually a symptom of certain autoimmune conditions like lupus.
• Diabetes: Can be detected if the retina shows fluid leakage, which can lead to diabetic retinopathy—a common cause of blindness.

How Dental Insurance Can Help Protect Employees’ Health

Including dental coverage in a voluntary health benefits package is another way to help protect your employees’ health. According to the National Association of Dental Plans, having dental insurance increases the likelihood of visiting the dentist, receiving restorative care, and experiencing better overall health. Regular dental care can also help prevent certain conditions. A WebMD article reports that “bacteria that [build] up on teeth make gums prone to infection.” Oral infection causes inflammation in the gums. This inflammation can lead to serious health problems, such as:

• Periodontitis: This condition is severe gum disease in which the gums and bone structure that supports teeth becomes damaged.
• Diabetes: Can be caused by oral inflammation that makes it more difficult for the body to control blood sugar and utilize insulin.
• Heart attack/stroke: 91 percent of people with heart disease have periodontitis. Researchers suspect that the risk for heart disease increases because it’s likely that oral inflammation leads to inflammation in the blood vessels. Inflamed blood vessels can build up fatty plaque. When the plaque breaks off, it can travel to the heart or brain and result in a heart attack or stroke.
• Pregnancy issues: Researchers also think there could be a link between gum disease and babies being born prematurely or at a low birth weight. Some medical professionals recommend that women who plan on becoming pregnant and those who are pregnant get a periodontal exam.

Save Employees From Medical Debt and Financial Burden

In a medical bills survey from Kaiser Family Foundation (KFF), 19 percent of Americans with employer-sponsored group health coverage have had trouble paying their medical bills in the past 12 months. The survey also reported that 66 percent of people said their medical bills were a result of a one-time event, such as getting treatment for an accident or being admitted to the hospital. Incidents like these are some of the reasons why voluntary health insurance that pays cash benefits directly to the policyholder exist. Cash benefits can be used to pay for medical or living expenses, or however your employees decide. So when you offer voluntary health benefits, you’re being a small business hero because you’re helping to save employees from building medical debt and dealing with the financial burden that comes along.

Accident Insurance

Most unintentional injuries or accidents happen outside of work, so workers’ compensation insurance wouldn’t cover employees for off-the-job injuries. A 2013 Medical Expenditure Panel Survey revealed the average emergency room (ER) charge was $1,498 for sprains and strains and $2,103 for other injuries. Many health plans require either a coinsurance or copay for ER visits, but some require both. The amount not covered by health insurance could cost an employee hundreds of dollars. Accident insurance could help protect employees from medical debt because the plan pays a lump-sum cash benefit for covered expenses like ER treatment, surgery, physical therapy, and hospital confinement.

Hospital Confinement Insurance

Along with ER visits, hospitalizations make up the largest dollar amount for healthcare expenses among those who have trouble paying medical bills, according to KFF. To add fuel to the fire, JAMA Internal Medicine reports that the out-of-pocket costs for inpatient hospitalization increased by 37 percent from $738 in 2009 to $1,013 in 2013. Hospital confinement, also called hospital indemnity insurance, usually pays a daily cash benefit, which can help pay for this expense. This type of voluntary health benefits plan offers increased cash benefits for the first 5 days of confinement, and has no network restrictions or pre-certification requirements.

Critical Illness/Cancer Insurance

Treating a critical illness like cancer can be costly. In a 2015 report from U.S. News & World Report, the average annual out-of-pocket costs for new cancer drugs was $24,000 to $36,000. Critical illness insurance can help offset out-of-pocket treatment costs. Benefit amounts for a critical illness policy can range from $10,000 all the way up to $1 million, according to the American Association for Critical Illness Insurance. If you want to get a policy without having to take a medical exam, many insurance companies offer a cash benefit amount of up to $50,000.

Some critical illness plans are sold as cancer-only insurance plans while others include coverage for certain types of cancers as well as other serious conditions like a stroke or heart attack. You can choose to offer a cancer-only plan or a broader critical illness plan or both. An agent can meet with your employees individually at no charge to determine which voluntary health plan options are best for your business.

Disability Insurance

Disability coverage is a way for employees to get replacement income if they have to miss work due to an illness, injury, or accident that results in a disability. In most cases, short term and long term disability insurance is offered as a voluntary benefit. But in a few states, disability insurance is a benefit employers must provide. A supplemental disability plan can be a lifesaver because it can help employees continue to meet daily cost of living needs. And considering that Social Security denies 65 percent of disability applications, offering this benefit can help save employees from the financial burden of lost income.

Long Term Care Insurance

Although long term care needs typically become more necessary as people grow older, adults of any age could need long term treatment at an assisted-living facility, nursing home, or private home due to a disabling injury or serious medical condition. Employees may expect that Medicare will cover their long term care expenses when they get older, but Medicare as well as Medicaid and private health insurance only provide limited coverage. Also, premium rates for long term care insurance usually go up significantly after age 60, so it may be best for employees to get this voluntary benefit earlier in life. By making long term care coverage a part of your voluntary health benefits package, employees may be more likely to see the value in how this benefit can help protect their financial future.

Fixed Indemnity Insurance

A fixed indemnity insurance plan is designed to supplement major medical coverage by helping pay for the out-of-pocket expenses left over from services, such as a doctor’s office visit, ambulance ride, and outpatient surgery. Like other types of voluntary health insurance that pays cash benefits, an employee can also use funds to help pay living expenses or replace lost wages. Employees who enroll in this plan can also add dependents under 18 years old.

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