Real-Time Relevance: Employee Benefits Evolve to Meet Today’s Needs

Real-Time Relevance: Employee Benefits Evolve to Meet Today’s Needs

Supplemental benefits are no longer on the back burner. Employers can refine and re-evaluate these health plans to offer layered protection for their workforce.
Laura Bongiorno
Laura Bongiorno, Head of Voluntary and Specialty Sales, Group Benefits, The Hartford
Another open enrollment period has come and gone. Choosing health insurance plans is usually front and center for most employees, but the pandemic raised awareness about other benefits that can help them protect their paycheck. Supplemental benefits, like life and disability insurance, and voluntary benefits such as accident, critical illness and hospital indemnity insurance became more relevant as many people became ill or lost loved ones. Employees may have overlooked these benefits in years past.
Not anymore. And maybe not ever again.
Life-changing losses, illnesses and economic setbacks from the pandemic have sharply shifted the focus of employees toward the bedrock benefits that protect income and help cover unexpected medical costs. Supplemental health plans often help fill financial gaps left by high deductible medical insurance policies. Many employees may have added these benefits and used them for the first time in 2020. The Hartford’s 2021 Future of Benefits Study showed that in the most recent open enrollment:
  • Life insurance was the most commonly elected benefit overall (81%), and 21% of those employees said it was a new selection for them.
  • Critical illness and hospital indemnity were the most frequently selected new benefits (46% each). A total of 35% of those employees said critical illness was a new selection for them, while 32% said hospital indemnity was a new selection.
“Either out of direct experience or heightened awareness, many employees were specifically looking for these types of protections when it came time to opt in to benefits or even buy additional benefits,” says The Hartford’s Laura Bongiorno, head of voluntary and specialty market sales for Group Benefits at The Hartford. “They realized just how valuable those products and services can be.”

The Industry Reacts and Refines Benefits

These employee benefits may have been offered by employers for years. Insurers have been closely re-examining and refining them to make sure they stay relevant. Supplemental health plans, such as critical illness, hospital indemnity and accident insurance are good examples. Carriers also quickly adapted to the pandemic in 2020. Many provided benefits for COVID-19 testing. Others extended their grace periods to keep coverage active while employees were furloughed during workplace shutdowns. 
The pandemic has created new stressors for just about everyone. The Hartford’s research found that 27% of U.S. workers say they struggle with depression or anxiety most days or a few times a week, up from 20% in March 2020. Many employers promoted mental health support programs to encourage their use. Some carriers, like The Hartford, enhanced their hospital indemnity plans to help support treatment for mental health and substance use disorder conditions.
The industry remained flexible and strong to support its customers through this pandemic. Now, insurers are ready to help employers and employees prevail through any new health crisis that may come.

Employees Can Learn About Layering Protection

With the realities of the pandemic still painfully fresh, now is a good time for employers to increase benefits education. An important lesson is that when used together, supplemental plans make a stronger safety net.
Let’s say an employee with supplemental health coverage has a heart attack. Their medical insurance will likely have a deductible and a co-pay for many treatments. Here’s how those plans would layer:
  • Critical illness coverage can be used to pay the deductible or any other out-of-pocket costs that arise.
  • If the employee is hospitalized, hospital indemnity insurance may provide cash for each day the employee is in the hospital, which could be used to cover co-pays.
  • Once the employee has recovered, they may be eligible for a wellness benefit when they receive preventative follow-up care, like their annual physical under their accident policy.
These benefits don’t cancel each other out, but instead add layers of protection. Each would pay a lump sum cash benefit that an employee can use for any need – from medical costs to household expenses. They can help pay for childcare, food delivery, housekeeping, dog-walking, home health aides or other support services.
Part of benefits education is highlighting affordability. According to the Federal Reserve, half of U.S. families have less than $5,300 in their checking and savings accounts. A serious illness like cancer can result in expenses up to the medical plan’s out-of-pocket maximum, which can be $15,000-$17,000 in-network.
“In some cases for as little as $11 per month, an employee can buy $20,000 of critical illness coverage for expenses due to heart attack, cancer or stroke,” says Tarie Summers, director of supplement health products for Group Benefits at The Hartford. “For many people, that benefit can prevent a health emergency from turning into a financial emergency.”
Benefits education shouldn’t stop when open enrollment ends. Employers can tap into carrier resources such as videos, webinars and other tools for year-round messaging. Additionally, advancement in benefits technology and greater carrier access to data now give employees personalized information based on their life stages, benefit needs, buying habits and mindsets.
With more options and education about how to make the right choices, employees can feel confident that their benefits package best suits their needs and the needs of their family.
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