Voluntary benefits have been around since the 1950’s. It is now a $26 billion dollar industry and growing by 10-12% every year. With high deductible health plans on the rise, and increased cost sharing being shifted to employees, the market is seeing new trends emerge to assist employers by further reducing their costs and minimizing the impact to their employees.
While companies are increasingly seeing voluntary benefits as an effective tool for boosting employee commitment at little to no cost, they generally are not aware of all the value services that many carriers and/or enrollment firms offer. As the industry grows...the carriers and enrollment firms are at a full sprint to gain as much market share as possible through new innovative products and free services.
The Industry Today
With more than 15 voluntary benefits carriers and countless enrollment firms, the world of voluntary benefits is vast. The everyday benefits broker is generally too busy managing the core benefits that they don’t have time to learn and understand what is available to them when they are enrolling voluntary benefits. Having a voluntary benefits specialist on staff is critical, as they are able to become a student of their profession and keep a “coupon book” of all the value services that are available and where to get them.
Benefits and Services
A voluntary benefit specialist will approach product selection and enrollment services from a different perspective. First they will want to conduct a full demographic and benefit analysis to understand the employee population and make product recommendations. The benefit specialist will want to understand the goals of the company and what value services will best support those efforts.
Carriers are willing to offer many of these value solutions such as biometric screenings, telemedicine and benefit administration systems, if they are able to meet with 75% or more of the employee population. This does not mean that the employee has to buy anything, but they just need to learn about what is available to them either through face to face or telephonically.
Latest Trends
For example, a telemedicine program that offers 24/7 doctor consults with medication prescription, coupled with voluntary benefits and a strategic communication campaign, is a great way to reduce urgent care and emergency room utilization. Some carriers offer a telemedicine base program at no cost with the implementation of voluntary benefits, which is a great way to reduce overall medical premium costs.
Another hot trend in the market is biometric screening. These programs help employees to know their numbers and strive to create a healthier population, which in turn is known to reduce overall medical premium costs. Generally the costs to implement this program are not viable for many companies, especially when they are looking to reduce their costs now. Many voluntary benefits carriers offer free biometric screening with their critical illness programs and some are now even offering it at no cost to all employees, as long as they are able to meet with the majority of the employee population to explain the benefits.
Preparing for Health Reform
2014 is right around the corner and many companies are looking for benefits administration systems to streamline their processes that will be required. Many carriers either partner with a benefits administration provider or they are willing to offset or pay for the cost for a system. The reason- it automates billing and makes it easier to offer their products.
Enrollment firms have also jumped on the coupon train and will offer value services such as dependent verification, benefit packet fulfillment, ongoing call center, benefit booklets and other low-cost hybrid specialty products at no cost when enrolling with the right conditions to communication the voluntary benefit products to the majority of the employee population.
Conclusion
If you don’t have a voluntary specialist on board, you need to if you want to compete in the years to come. More and more benefits will be employee paid and more brokerage/consulting firms will be voluntary savvy. They will have their book of coupons ready and you don’t want to be left trying to pay the entire bill that someone else got at $0 cost.
This article is courtesy of Krystie Dascoli (krystie.l.dascoli@wellsfargo.com), Vice President of Voluntary Benefits at Wells Fargo Insurance Services.
