Pairing “Pocket Protection” Strategies with High Deductible Health Plans

Rising medical coverage premiums can feel at odds with managing a favorable workplace budget. That’s likely one of the primary reasons you decided to offer a High Deductible Health Plan (HDHP) to your employees.

But, offering an HDHP is only the first step. It’s also important to consider how your employee benefits package might be constructed to wrap around your medical plan and provide further out-of-pocket support for employees. After all, both business and personal budgets can feel the stress of absorbing more premium costs.

Employees Seek ‘Pocket Protection’

Often, employees are not only paying more in premiums but also in co-pays and deductibles with HDHPs. In fact, the average employee deductible increased 161 percent from 2009 to 2019.¹

All of this can lead to an additional workplace management challenge for leaders to combat—employees feeling stressed and distracted with efforts to manage out-of-pocket health-related costs. Offering strategic supplementary benefits may ease worry and provide budget relief for both you and your employees—the “pocket protection” everyone is seeking.

Below are some commonly considered benefits employers offer for helping their team manage everyday out-of-pocket medical expenses and unplanned major medical events. With a little education, employees may use such benefits to wrap around their HDHP for the additional financial protection they seek:

• Cancer Insurance
  Even with a high-value health plan, if one of your employees were to be diagnosed with cancer, the out-of-pocket medical expenses could be extensive. That’s why it’s important to offer a cancer insurance plan to help cover the overall costs of cancer.
• Accident Only Insurance
  Unexpected accidents can cause a financial burden for your employees and their families. Being prepared can make all the difference. Accident insurance provides your employees with a financial solution to help cover the accidents that life sometimes delivers.
• Hospital GAP Insurance
  With higher deductibles on major medical coverage, your employees are left with more out-of-pocket expenses. Hospital GAP Insurance is a low cost option for your employees and their families to help fill the gap for their share of any unforeseen medical expenses before their deductible is met.
• Critical Illness
  Many employees are unprepared for the financial burden of an illness, such as a heart attack or stroke. Having the resources to help cover these types of events can make all the difference in their recovery. Critical illness insurance may provide a solution for your employees and their families if they suffer from a covered illness.
• Health Savings Account (HSA)
  With rising deductibles causing larger gaps in coverage, finding solutions to cover out-of-pocket expenses is on every employer’s mind. An HSA paired with a qualified HDHP allows your employees to set aside pre-tax dollars to help pay for medical expenses. It is an employee-owned account, which means your employee’s leftover funds carry over from year to year and the account is portable.

Keeping the Pace – Benefits Budgeting, Education, Compliance

The dynamics of employee benefits have changed drastically in the last five to seven years. Dramatic regulatory changes, technology enhancements to support customer needs, increased administration requirements, and benefits features being re-worked to fit the changing market all lead to significant changes. Understandably, our customers tell us this all feels overwhelming and they just don’t have the time to keep up.

We’re here to help. Our team is dedicated to keeping the pace, simplifying and educating you and your team with the following:

• Benefits budgeting strategies for you and your employees
• Administration and paperwork relief
• Patient Protection and Affordable Care Act compliance guidance
• Year-round enrollment support
• Communications campaigns
• Employee benefits education

Benefits are important to employee satisfaction, but they're just one of many expenses you're trying to manage. With budgets being strained in the current environment, you’re battling how to balance retention while focusing on your organization’s needs.

What if there was a way to reach your organizational goals, save time, and provide great benefits to your employees, without hitting your budget? For more information, please reach out to your American Fidelity account manager.

 

This blog is up to date as of July 2020 and has not been updated for changes in the law, administration or current events.

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