Most employees, and for the most part employers, can’t tell the difference between a mandatory and a voluntary benefit. Which in turn creates quite a confusion during open enrollment.
Because I want to talk about the very important voluntary benefit, I am just going to give you a very short explanation so that you can clearly understand, once and for all, the difference between the two. Mandatory benefits come from the Obamacare era where the law known as the Affordable Care Act mandated that every individual legally living in the US, carry health insurance. Health insurance referring to policies covering basic medical and hospitalization. On the other hand, policies covering dental and vision were left to the consumer’s discretion, hence, voluntary, also known as ancillary products. Another point which makes these products voluntary is that the company is not required to offer, or to pay 50% of the ancillary product’s premiums. Although, most companies I know choose to include the 50% as part of their employee benefits.
As a business owner, you are probably aware that if you have fifty full time employees or more you are required by the Affordable Care Act (Obamacare) to offer employees medical and hospitalization programs. But carrying voluntary or ancillary programs as options may be invaluable to your employees.
I can just see many of you thinking, I have less than fifty full time employees, this does not pertain to me. Well, it does. In previous blogs we determined that a good benefits package is essential for talent acquisition as well as talent retention, regardless of the size of your business. And to attract the best talent in today’s market, a good benefits package has to offer mandatory as well as voluntary programs.
So, what kind of value does offering a voluntary or ancillary product bring to the employee. Let’s think about the high cost of dental care. The average cost of a regular dental cleaning is between $75 and $200. If your teeth need deep cleaning to eliminate plaque, the cost may go up another $100. The average cost for an x-ray is $85 to $240. And we all know that a good dentist is not going to charge on the lower end of the spectrum. A good dental policy will help mitigate these costs. Couple it with a vision program for a few dollars and your frames and lenses will become affordable.
Life insurance and Short-Term Disability are two other voluntary products that may be attractive to your employees. And why is this? Well, acquiring these products outside of the group scenario can be very costly, and most working-class individuals cannot afford the expense on their own. But the cost of investing in a life or disability product suddenly becomes affordable when purchased through a group. Also, lending to the affordability factor is that each of these policies, especially the disability policy, are quoted based on salary.
Including voluntary benefits to your benefits offerings, has no cost to the employer yet brings tremendous value to the employee. So, it’s a win-win for everyone.
If you wish to learn more about these products and how they can enhance your current program, please give us a call, 305-776-8962 or email us at firstname.lastname@example.org.