By Trevor Garbers
If there’s a hot button among American employees these days as they struggle to stretch their paychecks, it’s healthcare.
Up to 37 percent of employees have trouble covering their healthcare insurance premium, while as many as 43 percent of them struggle to meet their deductibles. And 31 percent of workers can’t afford their co-pays or prescriptions.
In today’s healthcare model, higher deductibles – anywhere from $1,000 to $10,000 or more – are increasingly common. That’s great in the way it saves the employer in total benefits costs. But it leaves a big financial gap for employees. That’s especially so when the average daily cost of a hospital stay these days is about $2,000, and it’s accompanied by substantial out-of-pocket costs, averaging $1,586 for heart attack-related stays and $1,509 for a hospitalization for appendicitis.
Recognizing this problem, employers are working closer with consultants and stepping up with ways to help fill the gap without leaving a large financial burden for their employees, which can increase absenteeism and lower productivity. Hospital indemnity plans (HIP) are offered as either voluntary benefits or are paid by the employer to help employees overcome the financial divide.
Either way, it’s benefits like these that ease the transition to the high deductible plans. Employers win with longer-term benefits savings. And employees have an affordable option that provides them financial support and peace of mind if an unexpected medical event occurs.
Hospital indemnity plans provide specified fixed-dollar-amount benefits for covered hospital services and durations, regardless of the actual cost of the service. The policies are independent of group health insurance coverage.
While some employers are including hospital indemnity plans in their menu of voluntary benefits, a growing number are putting some of their high deductible plan savings to work for their people by paying as much as 100 percent of the premium, often covering an employee’s entire family.
Whether the employer pays all or a portion of the premium or it’s the employee shouldering the cost, hospital indemnity plan premiums can be quite reasonable. And the policies are well worth the investment for employees who are less stressed, more engaged and more productive when some financial pressures are removed.
Financial wellness and physical wellness are different sides of one coin. Solutions to better manage them both are as important to financially struggling employees as they are to employers. Adding a layer of voluntary benefits like hospital indemnity plans, accident and critical illness insurance goes a long way towards creating a cure. Your HUB employee benefits advisor is ready to help you weigh the options.