A Benefits Solution to the High Cost of Health Care

As 2012 moves forward, American businesses and workers will be heavily impacted by rising health care costs and continued economic concerns. The general sense of confusion and uncertainty surrounding health care reform may add more worry and financial stress, especially when unexpected medical costs arise.

So what can agents do to ease their clients’ financial burden relating to rising health care costs during an already stressful time? The answer is simple: emphasize available voluntary insurance policies that help offset high out-of-pocket medical costs.

Supplemental or voluntary insurance plans are designed to help people cope with incremental out-of-pocket costs associated with accidents or illnesses—specifically the costs major medical insurance does not cover. In the event of an unexpected accident or illness, policyholders receive cash benefits that are often used to help pay for daily living expenses, such as rent, transportation, groceries and other necessities. And voluntary benefits have no direct costs to the employer, making them an attractive solution to managing expenses, while giving employees added protection and more control over their benefits decisions.

When talking to potential clients, agents should underscore the fact that increasingly more organizations are turning to voluntary benefit options as a solution to market challenges. According to the 2012 Aflac WorkForces Report, 61% of employees say they would be likely to purchase voluntary insurance benefits offered by their employers.

Health crises and financial uncertainty can directly impact an employee’s productivity on the job. Workers who are stressed about their health or financial situations will not be able to concentrate and get their work done.

And what is one way employers can help promote a healthy work environment so everyone can stay focused on their job? They can offer robust health benefits to employees—ones that provide financial relief in the face of an unexpected illness or accident. Voluntary insurance policies are meant for these situations. Traditionally, many employers have been too narrow in addressing solely physical health concerns, often disregarding the importance of a financially well employee as a key part of overall wellness. Yet, the impact of the current economic landscape, combined with a general lack of basic understanding of financial principles, has left many American workers in fiscal distress and high debt. In fact, the Aflac study found that only 8% of workers strongly agree their family will be financially prepared in the event of an unexpected emergency, while 51% are trying to reduce debt.

Nearly six in 10 workers (58%) don’t have a financial plan in place to handle the unexpected, and the same percentage either doesn’t consider health insurance a part of their financial plan or consider it a minor part, according to the Aflac study. Clearly, Americans are in financial hurt and that often means turning to their employer for help. Voluntary policies can help workers be better prepared financially for unexpected health events or high out-of-pocket expenses that major medical plans don’t cover.

The benefits of employers investing in workers’ health provide for a better chance of a happier, more productive and more financially sound workforce that ultimately impacts a company’s bottom line. Everyone should be making the right lifestyle choices every day, but employers can also help create a healthy organization by offering adequate wellness and health insurance coverage.

Agents should ask their current and potential clients how they are investing in the health of workers. Are they leveraging wellness programs to drive down health-related costs? Are workers engaged and making informed decisions on the benefits options that best suit their needs?

Most companies focus on controlling health insurance costs at the expense of their workers rather than providing adequate insurance coverage that protects the health of the workforce. High medical expenses and unhealthy habits of workers erode corporate wealth and diminish productivity, which is why companies should invest in workers by providing wellness programs and the benefits options that help protect employees and their families.

Clearly health costs are on the minds of individuals and employers alike. Agents should work closely with clients to ensure they have all the tools and knowledge needed to help provide employees with peace of mind when faced with financial burdens due to unexpected medical expenses. It’s this peace of mind that will allow employees to focus on their jobs rather than spend time stressing out about life’s unfortunate and unavoidable events, which often come with a hefty price tag.

Thomas Giddens joined Aflac in 1983 as assistant vice president in the marketing department before serving in the field for more than 20 years.