As advisers and employers wait to see what will happen with the next phase of healthcare reform, one constant remains: employers are still gravitating toward high deductible health plans, which continue to make voluntary coverage an important sales priority this year.
Regardless if they are being offered to help an employer save on health care costs, HDHPs create gaps in employee coverage that voluntary benefits can help fill.
While the Affordable Care Act helped expand the need for voluntary benefits by encouraging the move to HDHPs, it didn’t create the need for them. An employee’s need for voluntary benefits transcends medical coverage, as employees are susceptible to costs they may incur from having a catastrophic illness or injury. According to a report from the Federal Reserve, 46% of adults say they either could not cover an emergency expense costing $400, or would cover it by selling something or borrowing money.
Not only that, the Federal Reserve also found 22% of adults experienced a major unexpected medical expense they had to pay out of pocket in the prior year, and 46% of those who say they had a major medical expense report that they currently owe debt from that expense.
What these stats show is that a significant portion of adults in the U.S. wouldn’t have the savings to withstand a catastrophic medical event, an injury sustained in an accident or a hospitalization — without taking a serious hit financially. Overlooking voluntary benefits during the ACA uncertainty could be putting your client’s employees at risk.
Approaching voluntary benefits in sales
In your client meetings this year, it will still be important to touch on how high deductibles and out-of-pocket expenses may leave many employees exposed financially if they incur a serious health issue. Showcasing how products such as critical illness, accident and hospital indemnity insurance can provide additional coverage for employees and help reduce the amount of money spent out of pocket can help clients support employees in these times of uncertainty.
Not only that, many voluntary products are HSA-compatible and work with any type of medical plan. That can help make it even easier for employers to make sure they’re creating an employee benefits package that best suits the needs of their employees.
While it may seem like voluntary benefits may not be a sales priority this year, they are still important for clients looking to provide financial security solutions to their employees. Showcasing the way voluntary coverages can help address the gaps many employees are exposed to with HDHPs can help your clients create robust benefits packages and aid in their efforts to make sure they’re providing the right benefits for their employees.
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