• Demand for Voluntary Fixed Indemnity Medical Insurance Is Rapidly Expanding, According to a New Study

    June 9, 2021

    Critical Facts Employers Need to Know as They Plan for 2022

     

    2020-2021 will go down in history as the 18 months that rocked the employer-sponsored benefit world as employers realized that governmental compliance with the ACA mandates is not enough.
     
    A key HR paradigm shift is emerging today, moving from a focus on employee “wellness,” to a focus on employee “well-being.” Well-being encompasses more than physical health, but also includes emotional and mental health. The virus changed employees’ attitudes significantly, and they now expect their employers to fulfill needs for security, a key aspect of emotional and mental well-being. MetLife’s annual Benefits Trends Study showed that 80% of employees now believe employers are responsible for their health and well-being. With gaping holes in coverage under ACA-compliant plans, voluntary, supplemental Fixed Indemnity medical and ancillary plans have become a necessary part of the solution for employers in the small and medium-sized employers (SME) business sector.
     
    Willis Towers Watson (WTW), in a key survey, found that employees’ post-pandemic sense of security came MORE from their insurance benefits and less from actual money in the bank. WTW’s expectation was that enrollments in insurance plans would go down, in favor of putting money in savings and checking accounts, but they found the opposite to be true. According to the survey, 94% of employers, who responded now expect voluntary benefits to “hold great importance” over the next 3 years. That’s a pretty astounding indicator of a major shift in employers’ attitudes about their responsibilities toward employees.
     
    Voluntary, Supplemental Fixed Indemnity Medical Insurance helps pay for hospitalization and critical care that is top-of-mind for employees in a post-pandemic world. In fact, 65% of employers plan to offer hospitalization indemnity by 2022, and more than 75% plan to offer critical care indemnity, up from 42% and 57% respectively, according to the same WTW survey. This demonstrates that employees and employers are finding real value in this type of insurance, emerging from this unprecedented world healthcare event.  
     
    But the Brookings Institute appeared to take an opposite view in August 2020 with an article entitled “Fixed Indemnity is a Problematic Form of Junk Insurance.” But even in this article, which applied a sweepingly false label to an entire class of insurance, the issue was not about the true value of Fixed Indemnity, but an argument against charlatans who are using deceptive marketing tactics to masquerade it as Major Medical Insurance. The Brookings Institute, however, does make an important point for employers —buyer beware. The providers’ reputation and longevity in the industry matters as a starting point to fend off those with too-good-to-be-true schemes. Nothing can be worse for employees who want the security provided by a Fixed Indemnity Plan than to discover they have been duped in some way. Employers need not just offer Fixed Indemnity Insurance, but vet it as well. For a more complete review of the Brookings Institute findings, go to The Truth About Fixed Indemnity Insurance: A Must Read for Employers.
     
    A key takeaway for employers is to choose the right Fixed Indemnity Insurance Plan, which if properly designed should cover a large portion of everyday medical expenses as a supplement to any Major Medical Plan. Employers also must clearly communicate that Fixed Indemnity is not a substitute for Major Medical Insurance.
     
    Voluntary Fixed Indemnity Insurance can also be paired with a relatively new benefit that is widely seen as critical in the post-pandemic environment — next generation telemedicine, and more specifically, virtual primary care. This is especially important in the mental health field where there are acute problems with access to care as 67% of the population say they have suffered from mental anxiety over the past year. Virtual primary care has been growing and is especially valuable for those with chronic conditions that may limit their access to bricks and mortar doctors’ offices. Harvard Business Review calls virtual mental healthcare a lifeline in light of the increased anxiety due to social isolation and new work-from-home business strategies that are expected to continue. A good voluntary plan should include treatment for mental and emotional problems that have sky-rocketed due to the pandemic.
     
    In summary, employers should be well-advised that in today’s market those who ONLY offer a bare minimum ACA-compliant plan will be at a severe competitive disadvantage, especially in certain lower-wage industries. Employers are now, more than ever, expected to address the total “well-being” of their employees, and the right Fixed Indemnity Medical and Ancillary plans provide the solution for small and medium enterprise (SME) employers. But employers should also be aware that not all Fixed Indemnity insurance is created equal, neither in plan design nor administration.  (For more on this topic go to: “SME Employers: 3 Key Factors to Consider When Building Your Benefits’ Strategy.”)
     
    Finally, as more and more employers plan to add important voluntary, supplemental Fixed Indemnity Medical Insurance coverage just to catch up to new employee expectations, virtual primary care should also be a major consideration in their benefits’ strategy in order to keep pace with new trends in the delivery of healthcare that, no doubt, will become entrenched.

  • Small and Medium Sized Employers: 3 Key Factors to Consider When Building Your Benefits’ Strategy 

    June 4, 2021

    A Necessary Change of Perspectives on Healthcare, Post-Pandemic

     

    As industry experts are now assessing the effects of the COVID pandemic on employer benefits programs, key concepts have emerged, changing best-practices from a “wellness” approach, to a “well-being” approach. A key Willis Towers Watson survey, along with others, demonstrate that mental and emotional well-being is now top-of-mind for both employers and employees. Also, gaining traction is a focus on “equity,” as opposed to “equality” in benefits; and insurance that addresses specific employee demographic profiles. So how do employers with limited resources address these new paradigms?
     
    It is critical for Small and Medium Sized Employers (SME) to evaluate the over-all costs and sustainability of a total-care solution that includes required major medical healthcare insurance (ACA-compliance) along with the most cost-effective benefits that contribute to an employee’s sense of well-being. While larger enterprises can scale benefits, SMEs do not have the same flexibility. Giving your workforce unlimited vacation, for example, is much more difficult, as smaller organizations don’t have an adequate workforce to spread the workload. In addition, SMEs are also less likely to have the necessary resources for benefits administration. That is why their benefits’ strategies must be mission-critical, focusing on the most important benefits that lead to a sense of overall well-being (or stress reduction) in a total care solution.
     
    What Are the Most Significant Stressors for Employees Today?
     
    1. Industry experts have identified financial limitations as one key contributor to employee stress in light of the COVID pandemic, especially among low-wage workers.
    2. Remote workforce strategies are here to stay, and social isolation is a key contributor to employees’ stress-levels and need for mental health services.
    3. While lower-wage workers have been more likely to forego primary healthcare during the pandemic, leading to lower utilization rates in the past year, utilization is expected to increase, as health concerns have led to increased stress for employees.
     
    Addressing these key stressors must be the baseline for building equitable benefits’ solutions for employers in the SME sector. Experts in the industry, including Willis Towers Watson, identify voluntary benefits as critical to building your benefits program. Voluntary benefits include supplemental fixed Indemnity medical insurance, as well as ancillary benefits such as vision, dental, disability and term-life insurance as the most important. Without these key benefits, attempts to build programs in a shotgun approach that can appeal to a wide range of “lifestyles” or demographics is completely ineffective, and can even lead to increased employee stress levels. With all of the above in mind, employers need to consider the following:
     
    Best Practices Solutions for SME Employers
     
    1. Employers must first assess their own resources as it relates to benefits’ administration. This is often overlooked as brokers present multiple voluntary benefits’ solutions from multiple Carriers. Disconnected systems lead to poor benefits’ administration and can backfire, creating employee stress and even negative perceptions of the employer benefits’ offerings.  The best strategy is to have one integrated solution for both your major medical and voluntary insurance. Digitized, integrated systems that take the administrative burdens off of your organization are critical in today’s healthcare environment. While there are many HRMS (Human Resources Management Software) solutions on the market, the capital investment can be cost-prohibitive and disruptive. There are also aggregators of HR solutions, who may provide benefits under one umbrella, but system integration and administration can be a problem without the proper technology platform that fits your existing systems. Employers must carefully evaluate providers to ensure that not only are they providing the most important benefits for their employee’s well-being, but they are also providing the most cost-effective and needed administrative solutions.
    2. Secondly, voluntary benefits plan design is also mission-critical, as we move from wellness, to well-being as the guiding principle for benefits’ programs in a post-pandemic world. The best voluntary benefits plan can cover the majority of lower-wage workers’ out-of-pocket expenses, not covered due to high-deductible ACA-compliant plans. This means coverage for everyday healthcare, like doctors’ office visits, out-patient surgeries and tests, not accessible under the ACA plans, that still have an average of $6,000 in deductibles and copays. The WTW survey showed that hospitalization and critical care insurance has also become of primary importance to offset expenses that could otherwise bankrupt lower-wage workers. The right plan design, that is affordable to your employees, will alleviate financial stress related to both everyday healthcare needs and unexpected healthcare events, providing peace of mind that contributes to the “well-being” of employees. Such plan designs require sophisticated technological modeling and data-driven analysis for the most cost-effective coverage. The reputation and longevity of insurance carriers matters in your decision analysis.
    3. Thirdly, and closely related to plan design is the need for virtual care options, made apparent through the pandemic. Multiple studies show that mental healthcare through virtual digital experiences is as effective as in-person visits. In a Harvard Business Review article entitled “Digital Tools Are Revolutionizing Mental Health Care in the US,” the summary is:

    “The U.S. has long suffered from a severe shortage of mental health care services. The pandemic has put a spotlight on the effectiveness and wide availability of digital and virtual mental health care, and by doing so might have thrown a lifeline to our mental health system.”

    As many as 67% of the workforce has reported mental anxiety conditions in the last year. It is without question that mental health counseling is paramount to helping employees achieve a sense of well-being; and virtual care options are quickly being assimilated into the mental healthcare system.
    In conjunction, virtual, digital primary care is also changing the face of primary care models in the US. For the employer, primary care that is overlooked can lead to higher insurance costs. Employers can avert these outcomes by providing an easy, cost-effective virtual primary care benefit. For the employee, a virtual care benefit relieves problems with access and time constraints, as well as protecting vulnerable patients from exposure to contagious diseases.
    The bottom-line conclusions are fairly simple. While SME employers may not be able to provide all the perks of change-makers like Google, the pandemic served to clarify that affordable primary care benefits are a baseline for employee well-being and that the future of healthcare will be changed by those who provide the best digital tech solutions, in both healthcare and administration. Voluntary fixed indemnity medical and ancillary insurance that is affordable and addresses the biggest employee stressors, with easy and effective administration, is critical to the SME sector benefits’ strategy.

  • Labor Pool Dwindling as Normalcy Returns

    May 12, 2021

    Brace for challenges in hiring and retention.

    Prior to the winter of 2020, labor shortages were peaking as unemployment levels dipped to historic lows. In the three years leading up to the beginning of the COVID-19 pandemic, employers became quite familiar with the concept of job candidate deficiencies, finding themselves in stiff competition for available workers.

    At its crest, the Bureau of Labor Statistics calculated a national labor shortage of over 7.4 million workers with no signs of slowing, projecting a shortfall of nearly 9 million job vacancies within the next decade. Industries that had never needed to compete for employees, such as trucking/transportation, manufacturing, restaurant and hospitality, were turning to signing bonuses, tuition reimbursement, and recruiting out of high schools as methods to find and attract potential candidates.

    Then, in the spring of 2020, everything changed…

    Unemployment Rate Graph

    Historically low unemployment was clobbered in March of 2020; Rate returning to pre-pandemic levels today. Source: BLS

    Today, as the US slowly and cautiously returns to indoor dining, travel, brick and mortar shopping, et. al., industries affected by the downturn are suddenly seeing signs of life, if not soaring pent-up demand. In just a few short weeks, unemployment levels have fallen back into a more expected range, with economists citing temporary government relief payment programs as a reason levels aren’t even lower.

    Once again, employers are struggling to find workers, with all signs pointing to a re-emerging economy that will only intensify labor shortfalls. With the resurgence creating a seller’s market, employees can be choosy about the positions they seek and accept, and the availability of a healthcare benefit program is in greater demand than ever. MetLife Trends reports a 10% increase in employees who believe it is an employer’s responsibility to provide for their health and well being, rising to a full 88% of respondents who feel this way. Employers who disregard a healthcare program will be at a distinct recruiting disadvantage.

    In the largest study of its kind, Insurance Applications Group examined the retention patterns of over a half million temporary workers and found that those who were enrolled in our healthcare programs stayed with their employer 47% longer, on average, than those who did not enroll. In addition, employers who offer IAG products typically experience an enrollment rate 3x higher than competitive healthcare plans.

    With a labor shortage looming, consider leveraging an attractive, usable and effective healthcare plan to recruit and retain employees.

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