Are your employees stressed about medical bills? If they are, they’re not alone. A study from Paytient found that 40% of U.S. workers postpone health care needs because they’re worried about cost, even if they have health insurance. Medical care can be expensive, and group health insurance isn’t always enough. Employers can help their employees by offering worksite benefits like hospital indemnity insurance and other supplemental benefits.
What is hospital indemnity insurance?
Hospital indemnity insurance is a supplemental insurance plan that’s used in conjunction with an existing health insurance plan. The policy pays a benefit if the insured is hospitalized. Some plans also provide benefits for additional events, such as emergency room visits or ambulance services. The insurer may pay this benefit in installments or as a lump sum, usually directly to the insured. And, for most hospital indemnity plans, there are no deductibles, provider networks or other complications to worry about.
If you’ve ever received a massive bill after a medical emergency, you know what a relief this payment can provide. Your employees may use their hospital indemnity insurance benefits to cover deductibles, copays, out-of-network costs and other expenses associated with a hospital stay.
Why offer a hospital indemnity insurance plan?
Making hospital indemnity insurance part of your worksite benefits package can be helpful for several reasons. Hospital indemnity insurance can:
- Help alleviate stress about money. When employees are stressed about their finances, they may lose sleep and have trouble focusing. By reducing the stress associated with medical payments, employers may be able to boost worker engagement and productivity.
- Encourage employees to seek care when they need it. When people avoid going to the hospital because they’re worried about the cost, there’s a risk that their condition could become worse. If this is the case, when they finally go to the hospital, their condition may require more intensive and expensive treatment. By providing hospital indemnity coverage, employers give employees the financial freedom to seek care when they need it, which may result in a healthier workforce with fewer days away from work and lower health care costs.
- Create a powerful recruitment and retention tool. Having a comprehensive employee benefits package is important for attracting talent and fostering loyalty. A hospital indemnity insurance plan can be part of a compelling package.
Supplemental Benefit Options Beyond a Hospital Indemnity Plan
Hospital indemnity insurance coverage can be a great benefit to help employees deal with unexpected medical bills, but it’s not the only supplemental insurance option to consider.
Although hospital stays can be particularly expensive, other injuries and illnesses could result in significant costs even without hospitalization. Other supplemental insurance plans may be able to help in these situations.
- Accident insurance provides a benefit for injuries caused by accidents. Injuries like broken bones may not require hospitalization but could still result in expensive medical bills.
- Cancer insurance provides a benefit if the insured receives a cancer diagnosis. In addition to helping to cover medical costs, the payout can help with other expenses during treatment.
- Critical illness insurance can cover several different illnesses, such as heart attacks and strokes. Depending on the policy terms, it may also cover cancer.
Providing Hospital Indemnity Coverage (and More) as Voluntary Benefits
If you’re worried that offering all of these supplemental insurance options may be too expensive, there’s good news. First, these policies tend to be affordable, especially when compared to health insurance. Second, when you offer these options as voluntary benefits, employees cover the premium costs through payroll deductions. But, they still benefit from affordable group rates, making this a win-win arrangement.
The ideal situation is to offer multiple voluntary benefit options and let workers decide which ones they want to enroll in. However, education is key. To ensure your employees enroll in the plans they need and understand the value of their benefits, it’s important to provide information on what the plans cover, how they work and why it may be a smart idea to enroll. Your insurance broker may be able to provide these services to you, helping to lift the burden put on your HR team.
Is your worksite benefits package well-rounded?
Benefit staples like group health, dental, vision, life and disability insurance and a retirement plan are a good place to start. Many employees expect to have access to these benefits at work. In fact, they might not be interested in taking or keeping a job that doesn’t provide such benefits. However, these benefits may not meet everyone’s needs.
Research has found that rising inflation is a significant source of stress, so your employees may be struggling with their budgets. The American Psychological Association says global conflicts, the COVID-19 pandemic, climate-related disasters and social issues are also contributing to high levels of stress.
A comprehensive benefits package that includes supplemental health plans like hospital indemnity insurance can help employees navigate these issues. These benefit options can also help employers appeal to a diverse workforce that includes workers from different generations and with different needs.
Higginbotham can help you create a well-rounded benefits package that allows your company to achieve its goals. Talk to an employee benefits specialist who’s invested in the success of your business and the well-being of your employees.
