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Voluntary Benefits Can Help Bridge Coverage Gap

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With the increasing premiums and search for the right deductibles, co-pays and co-insurance to offer their employees, employers are looking to voluntary benefits to enhance their offerings to their employees. The value of medical, dental and vision plans in this competitive world of benefits has been well proven to attract and retain good employees. Voluntary benefits are less understood.

Statistics show that more than 60 percent of bankruptcy claims are due to medical bills. Many of these bankruptcy clients had medical insurance. What they may have lacked is financial protection benefits like life insurance, which protects their assets and disability insurance, which protects their paycheck. They also may not have had access to critical illness or accident insurance. These latter benefits pay out upon an emergency situation.

The medical insurance benefits pay the physician or facility and the voluntary benefits pay the employee. In most cases, these benefits are also portable since they are employee paid and belong to the employee, not the group.

Most critical illness and accident plans pay out lump sum amounts that can be used to pay costs of treatment, make up for lost income, help to pay household bills or mortgages and other incidentals. Many of these benefits interact well with wellness plans and may even pay a benefit if certain elements of wellness are completed. These transactions can be completely paperless and coordinate with banking information for making direct deposits.

Today, many large and mid-size employers offer up to five voluntary benefits. In 2015, according to the Employee Benefit News publication, voluntary benefits will be about a $7-billion industry. Now to supplement the medical health-care offering, even smaller employees are looking to offer this employee-paid benefit to their employees.

For more information on voluntary benefits, contact Patty Smith, the Association’s director of Employee Benefit Services, at 814/833-3200 or 800/815-2660.