Filed under: Small Business Benefits | Tags: dental insurance, disability, employee benefits, health insurance, middle class America, retirement planning
There have been endless surveys and studies done by far more scientific processes than those available to me, so I will generalize.
Ask the average working American what they want in their employee benefits package and they will say:
1. Health Insurance
2. Retirement Plan
3. Dental
4. Disability
Any business owner can tell you that health insurance is a necessary evil and testify to the fact that costs have increased nearly 87% since 2000. It is a disturbing trend that is stresses the financial tolerances of all parties, employer and employee alike. As a benefits specialist, I am concerned to see fewer employees opt to insure their families because it is simply too expensive. Beyond the obvious, this trend leaves the employee one incident away from financial ruin.
Retirement planning is a benefit best handled elsewhere, although I am encouraged by how much of a priority it appears to be with employers and employees alike.
Dental insurance and its rank in the list perplexes me. Employees want comprehensive coverage, of which, there is essentially no such thing. The typical plan charges $50 a month for a maximum benefit of $1500, most of which is never realized. I invite employees to put $50 a month in a folder in their dresser and then use that money for their dental care and see if they don’t come out ahead.
Disability insurance is fourth and for most of middle class American should be higher on the list. The single most important asset an employee has is their paycheck. The paycheck is also their single largest risk without protection. Employers often opt for long term disability because they can pay for the entire group and it is very inexpensive. Unfortunately, the overwhelming majority of disability need is short term (less than one year). Ask the average middle class American if they can go three months without a paycheck and they look at you as if you asked a stupid question.
So, what is the answer? Read the next post about the value proposition of voluntary benefits.
Filed under: Small Business Benefits | Tags: $500 deductible, employee benefits, group health insurance, health insurance, low deductible, texas
The traditional process of requesting quotes and going with the lowest bidder simply does not work for most small businesses. The time required to research and implement benefit plans is simply not available to the small business owner at the expense of managing their company.
Until now, the only alternatives were: offer no benefits or struggle with an ill-fitting benefit plan that stretches the financial tolerances of employer and employee alike.
I‘d like to introduce you to a different approach. We’re all looking for the magic bean in group health and employee benefit solutions. This approach may not involve magic, but it certainly provides a solution to a question that seemingly had no good answer. The solution is two-fold.
I. What if you could offer your employees a medical plan with:
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$500 deductible
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ID Card with access to Texas True Choice, the premier PPO network in Texas
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70/30 coinsurance with $3000 max out of pocket
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$30 doctor visit co-pay
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prescription plan
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chiropractic coverage
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dental coverage
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$15000 Life Insurance per employee
And have it cost less* than $250 per employee and as low as $425 per family?
Comparable major medical plans would cost in excess of $700 per employee and $1800 per family for a $500 deductible.
How does this plan differ from the others than I have known and/or used?
The only key difference is how the total coverage is calculated. This plan offers $100,000 of coverage per year (per covered individual) after which coverage ceases. A traditional group health plan can offer $1 million in lifetime coverage.
Is that enough?
Statistically, this plan will cover all needs 98.2% of the time. However, we have a solution for those who wish to buy up and have $1 million of lifetime coverage** in conjunction with this plan. The cost of the buy-up depends upon the age of the individual, but is typically between $30 ~ $50 per person who opts for it. The nice aspect of the buy-up solution is that it is voluntary to the employee and legally does not require the employer to pay for even a portion of it.
Basically, these solutions provide each employee a $500 deductible with up to $1 million in coverage for typically less than $300 a month.
* Rates are subject to medical underwriting and may be higher or lower depending upon the age, gender and medical history of applicants. ** While the group medical solution is guaranteed issue, the buy-up requires that the applicant qualifies medically. It is possible in some cases that an individual would not qualify for the buy-up coverage.
