Busting Employee Benefit Myths

Busting Employee Benefit Myths

  • Adding non-medical benefits would break the company’s budget:Affordable group dental, disability, vision, and life insurance options are available for companies with two to 99 employees. Adding benefits doesn’t have to mean adding to the benefit budget. Fifty-six percent of employees are willing to bear the cost of ancillary benefits, according to a recent MetLife study. Sixty-five percent of employees agree that having customized benefits would increase their loyalty. Employees who are satisfied with their benefits are nearly four times as likely to be satisfied with their job. A study from the Center for American Progress estimates that replacing an employee costs an average of 20% of their annual salary. So if a worker making $50,000 a year quits, you’ll pay roughly $10,000 to cover the lost productivity and then recruit and train someone new. It’s a better strategy for employers to focus on retaining key employees and driving increased satisfaction through benefits. This is especially important for small businesses where the cost of replacing an employee may be higher because it may be less likely that other employees have been cross-trained to fill in the gap. Brokers should discuss how the cost of benefits can be shared and that employees are willing to take some of the responsibility. Also, address the financial implications early on to show small business decision makers how non-medical benefits can add to their businesses.
  • Administering Group Benefits Is Too Time-Consuming: Consolidating multiple coverages with a single carrier can reduce administration. Exploring new channels, such as private exchanges, can help identify opportunities for increasing benefit choices while reducing administrative burdens. Making carrier recommendations based on services, ease of implementation, educational resources, and customer understanding as well as price will give small business decision makers the support they need.
  • Dental Insurance Isn’t Important: Dental insurance is a benefit that is in high demand—and highly utilized—by employees. Sixty-three percent of Gen Y and Baby Boomers are interested in purchasing dental insurance at work. More than half of Gen X are interested in purchasing this coverage. According to the National Association of Dental Plans (NADP), people without dental insurance are less likely to get dental care, which means missed opportunities for prevention and early treatment. In fact, the NADP finds that those without dental benefits report higher incidences of other illnesses: sixty-seven percent are more likely to have heart disease; 50% are more likely to have osteoporosis; and 29% are more likely to have diabetes. The Centers for Disease Control and Prevention finds that more than 164 million work hours are lost each year due to dental problems. By offering dental benefits, employers can capitalize on the link between oral health and overall health and lay the foundation for a healthier, more productive workforce. Small business brokers should discuss this link with their clients.
  • Benefits Won’t Help Attract Employees: According to a 2014 study from the Employee Benefit Research Institute, 76% of employees say benefits are a very or extremely important in their consideration of a job offer. Brokers should explain how small business owners can leverage the benefits they provide.
  • Benefits Won’t Help Retain Employees: According to Glassdoor.com, 48% of employees are confident that they can find a job that matches their compensation level within six months of starting a job search. With that in mind, small business owners need to evaluate what they are offering to employees beyond salary. What added perks will make employees feel valued enough to keep them from looking around in the first place?  CareerBuilder reports that 58% of respondents identified better benefits as the best way to improve employee retention. Offering better benefits means offering a range of benefits to meet a variety of employee needs; this includes medical plus ancillary options that employees can choose from and pay for on their own. Employees who are satisfied with their benefits are nearly four times more likely to be satisfied with their jobs, according to MetLife’s study, once again reinforcing the impact benefits can have on existing talent. Not offering a range of employee benefits opens the door to competitors looking to attract high-performing employees.

Study: Extra benefits are available in many Medicare Advantage plans

Coverage for dental, hearing or vision is available in 97% of Medicare Advantage plans, while traditional Medicare covers none of those benefits, according to a HealthPocket study. All three benefits are covered in 42% of Medicare Advantage plans, the study found. But “there was considerable variation for cost-sharing among these benefits as well as the extent of coverage” in Medicare Advantage, said Jesse Geneson of HealthPocket. “Consumers should review coverage details carefully before enrolling.” BenefitsPro.com (4/23)

Medicare Advantage Plans Offer Broader Coverage

Medicare Advantage plans contain many benefits that are not covered by original Medicare, according to a study by HealthPocket. The percentage of Medicare Advantage plans with at least one vision, dental, or hearing benefit that’s not included in original Medicare did not change between 2013 and 2014.
“While most Medicare Advantage plans included extra insurance benefits not in original Medicare Parts A & B, there is considerable variation for cost-sharing among these benefits as well as the extent of coverage. Consumers should review coverage details carefully before enrolling,” said Jesse Geneson of HealthPocket. From 2013 to 2014, the government reduced its benchmark payments to Medicare Advantage plans by 4%.
When reviewing data on 2014 Medicare Advantage plans, HealthPocket found the following:
• 94% of Medicare Advantage plans provide  vision coverage.
• 71% of Medicare Advantage plans provide dental coverage.
• 59% of Medicare Advantage plans provide hearing coverage.
• 97% of Medicare Advantage plans provide at least one extra insurance benefit (vision, dental, or hearing) that is not covered by original Medicare insurance.
42% of Medicare Advantage plans offer extra insurance coverage for vision, dental, and hearing together in the same plan.

For more information, visit www.HealthPocket.com. healthpocket,

Last Updated 01/13/2021

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