For the last several years, the latest employee management tool has been “empowerment." One way to improve job satisfaction is to educate and empower employees to make informed decisions, particularly in the benefits arena. One way to help drive down rising health care costs is to help make employees better consumers of health care. Many employers are looking to some of the new risk management tools such as HSAs (Health Savings Accounts) and HRAs (Health Reimbursement Arrangements) to push employees into consumer-driven health care. These are excellent tools and definitely should be explored by all employers; however, they may not always be a fit for your company.
There are three simple strategies to further empower your employees and give them more control over their benefit plans.
1. Health Plan Choices
Allow your employees to choose from two or more health plans. Offerings may include lower-cost plans which offer reduced benefits or higher deductibles along with higher cost plans with more comprehensive benefits. You may want to include an HMO option along with the more traditional PPO option. Some employers may also include a qualified HSA plan design for their employees to choose from.
2. Voluntary Benefit Choices
Provide a variety of voluntary benefits to enhance your employees benefit portfolio. This allows employees to choose specific products that meet their needs. These are typically benefits the employees could not purchase on their own; and they are able to enjoy the convenience of having the premiums payroll deducted on a pre-tax savings basis. Product offerings may include: dental, disability, accident, specified disease, long term care, supplemental medical, etc. Many employees may prefer to take a lower-cost health care option and purchase supplemental products with the savings.
3. Defined Contribution Approach
This is a combination of the two options above. Many experts believe this is the most cost effective way to empower your employees and actually manage your annual employee benefit cost. Instead of providing all of your employees a generous health insurance plan, give employees a benefit budget or dollar amount and let them choose which benefit plan or voluntary benefits they wish to purchase. Employees wanting richer benefits will pay more out of their pocket or paycheck in premiums.
The key to any successful empowerment campaign is education. You must take the time to educate your employees on the value of the different options available to them. Most experts agree that when employees have greater choices in benefit designs and coverages available, they are much more satisfied with their employee benefit plan.
Contact your Universal Underwriters account executive or call 800-8842 ext. 1616 to see if these tools are right for you and your employees.
This article provided for informational purposes only. Universal Underwriters is not providing legal advice. Consult your attorney to determine your business’ stance on these issues.
