A new research report, “Expanding the Benefits Horizon: How Employers View Voluntary Offerings,” published by the Employee Benefit Research Institute (EBRI), focusing on employer perspectives on voluntary benefits and the financial protections provided to American workers, finds that most organizations have seen improved employee satisfaction, recruiting, retention, performance, and employee health as a result of employee benefits programs.
“The report findings underscore the growing importance of voluntary benefits in the workplace. Employers are broadening the focus of their benefits beyond traditional offerings such as 401(k)s and health insurance,” says Jake Spiegel, senior research associate at EBRI. “Additionally, the research indicates that employers are expanding their focus from simply helping workers retire to providing protection for their financial well-being against healthcare costs, high costs of living, daily expenses, and the impacts of financial-related stress. Voluntary benefits can play a critical role in helping workers flexibly address these issues, as its nature allows employees to select coverages aligning with their unique circumstances and priorities.”
Key findings include the following.
- Most organizations report improvements in employee satisfaction, recruiting, retention, performance, and employee health because of employee benefits programs. Improving worker morale is the top-cited reason organizations offer employee benefits, as 85% of organizations say they see a positive impact on employee satisfaction as a result. Nearly three quarters of employers also see an impact on recruiting, retention and employee performance, while 70% see a positive impact on employee health. More specifically, offering a full suite of supplemental health solutions amplifies this impact as employers that offer accident, critical illness and hospital indemnity coverages are even more likely to indicate that benefits have a positive impact on retention and absenteeism.
- Nearly three-quarters of organizations list healthcare costs as an issue that their benefits program is designed to address, yet only 11% offer accident, critical illness, and hospital indemnity insurance. Approximately 73% of employers say healthcare costs are one of the top issues faced by employees that their benefits seek to address. While 93% offer medical insurance, 83% offer dental insurance and 80% offer vision insurance, supplemental health insurance coverage is less commonly included in a benefits program. The most offered supplemental health benefit is accident insurance, but less than half (46%) offer it. Also, far fewer offer critical illness insurance (27%) or hospital indemnity insurance (25%). Only 11% offer all three of these supplemental health insurance benefits.
- Organizations that currently offer dental, vision and supplemental health insurance indicate healthcare costs would be higher and productivity would be lower, if they did not offer these benefits. Employers broadly agree that voluntary benefits ease employee concerns, help workers weather out-of-pocket expenditures and are affordable for workers and their families. Many organizations feel that if they did not offer voluntary benefits, they would see premiums for their group health insurance plan increase, and some also anticipated lower productivity and more absences.
“The report highlights a disconnect. Employers who offer supplemental health benefits see a great deal of value, yet many employers do not offer these benefits. Health care costs are a top five issue employees face, but just under half of the employers surveyed offered accident insurance, and under three in ten offered hospital indemnity insurance or critical illness insurance,” says Sharon Scanlon, senior vice president, group protection product, workplace solutions marketing, and customer experience at Lincoln Financial. “Those companies that offer them broadly believe that these supplemental health benefits provide affordable protection, and frequently allay employer concerns such as increased absenteeism, lower productivity and higher turnover. Employees see the value, too, as evidenced by higher-than-expected enrollment rates for these voluntary benefits. A comprehensive suite of coverage options expands employees’ benefits horizon, and in turn, can increase satisfaction, retention, performance and health.”
