Do you own a small business, with, say, less than 50 employees? Maybe even less than 25 employees? As you look back on 2014, and ahead to 2015, what changes have you made in your benefits to those employees? Most likely, you’ve tweaked your health insurance policy to stay compliant with Obamacare rules. But what about those other plans that in past years were traditionally provided? Dental and vision used to be commonplace benefits, even in non-union workplaces. The same with group short-term disability and group life insurance. As an employer, you recognized then – and probably still do – that protecting your employees from a financial devastation caused by illness, injury or death helped retain your employees as well as build a strong morale among them. But health insurance changes and mandates over the past 5 years has caused many employers to no longer pay for ancillary group benefits.
There is a way, however, to continue – or begin anew – offering benefits to your employees. Through an approach of making these benefits voluntary, you can continue to make other insurances available, while at the same time relieving yourself from the cost. Perhaps you didn’t know this, but many insurers offer discounts on life and disability insurance if 3 or more employees will sign up for a plan. Those discounts last for the life of the policy, even if there is a loss of employment. All you, as an employer, has to do is allow your employees to meet with a licensed agent. Each participant gets his or her own statement and is responsible for paying the premiums. And, you can extend offerings to include hospital recovery, accident, and critical illness insurance as well as long-term care. Your employees can choose from any or all of the coverages offered.
How does this benefit you? Well, for example, one of your employees is injured in a skiing accident, is hospitalized for a few days, and laid up for a month. Do you continue to pay him or her, especially if paid hourly? Can your business “get by” for a month or do you need to hire someone temporarily, or ask others to work longer? And, if you do hire a temp, are you paying 2 people for one job? A dilemma, to be sure, one hopefully you never need to face. If the employee as coverage for short-term disability, income will continue during the recuperation. Hospital recovery and personal accident policies will pay lump sums to help offset health deductibles, etc. that can cause a financial pinch.
Obviously, voluntary benefits are just that: voluntary. But the volunteering must begin with your permission to allow your employees to meet during the workday, and at the workplace. Often, the best way to do this is at the beginning of the day, before work gets ramped up, through an employee meeting. If this isn’t possible, try to provide a room or desk where the agent can meet privately with any interested employee. Depending on how many employees, this can usually be accomplished over a 2-3 day span, with a minimum of disruption.
Oh, and you as owner are also eligible to participate. There are no ERISA rules on the percentage of eligible employees who must participate, unless you pay some or all of the premiums. Remember that discounts apply to each type of insurance. In other words, if 3 or more want group life insurance, discounts will apply. But if those three want life, disability and dental coverage, respectively, there is no discount.
Obamacare has eliminated many of the choices you had in deciding your policy coverage. Give your employees new choices for 2015 and watch your business grow.