The Social Security Administration estimates that over 25% of 20-year-olds will become disabled before reaching retirement age, and 25% will be out of work for at least a year due to a disabling condition. These stats are concerning given only 40% of Americans have access to short-term disability benefits and 35% to long-term disability benefits.
Fortunately, employers can help mitigate some of these stressors by offering employees access to supplemental health programs.
What Are Supplemental Health Programs?
Supplemental health benefits provide much-needed support for employees facing a health emergency by insulating them from unplanned out-of-pocket costs. These plans can include coverage for expenses related to an accident, a critical illness, or hospital costs, providing a layer of protection to cover what traditional health plans may not.
Supplemental plans work by paying a lump sum directly to the employee for use where it’s needed most. For example, in the event of a heart attack, an employee can receive cash-in-hand from their critical illness plan. This money may be used to cover the costs of their deductibles, hospital transportation, medications, or even nonmedical expenses like childcare and rent.
How Supplemental Health Programs Support Employees
In 2022, out-of-pocket maximums for health plans can be as high as $8,700 for an individual and $17,400 for a family. For many families, that’s a lot to pay — especially when the average hospital stay in the U.S. costs around $11,700.
Even with excellent traditional health coverage, an unexpected medical event could potentially cause a great deal of mental and financial stress for an employee. Prolonged stress can compound health conditions like heart disease, depression, sleep loss, headaches, digestive issues, and high blood pressure. Financial stress has also been linked to low levels of financial literacy, problematic financial behaviors, and decreased financial security.
In fact, up to 80 percent of health outcomes are influenced by social drivers of health, or non-clinical factors like access to nutritious food, reliable transportation, quality housing, and financial stability — meaning our health status is heavily dependent on things that happen outside of the doctor’s office.
Offering supplemental health programs can help alleviate some of the concerns that may arise with unexpected health emergencies, allowing employees to focus on their recovery and well-being. And with a range of options to choose from — such as accident, critical illness, and hospital indemnity insurance — employees can craft a benefits package that’s right for them.
How Supplemental Health Programs Help Employers
In a competitive labor market, a comprehensive benefits package not only gives employees peace of mind and shows your investment in their health, but it’s also good for your organization.
Employers can stand out by offering coverage including well-being support resources, disability benefits, and supplemental plans. Most supplemental benefit plans offer budgeting flexibility, with a range of employer contribution options from 100% all the way down to 0%, also known as a voluntary plan. With voluntary plans, employees pay the full premium for the plan, but benefit from a group discount rate — and employers benefit from healthier employees at no cost to them.
Supplemental plan offerings can:
- Improve employee satisfaction. Happier employees positively affect your organization’s ability to attract and retain top talent.
- Minimize bottom-line impacts. Supplemental plans can be offered at little to no direct cost to employers.
- Increase worker productivity. Employees with high financial stress say they are often distracted at work.
- Simplify administrative tasks. Plan costs can be deducted directly from an employee’s paycheck.
When delivered as part of a whole-health benefits plan, supplemental health programs may help improve outcomes, control costs of care, and support improved employee well-being. These plans can give your workforce the right support at the right time, helping them navigate unexpected events feeling protected and confident in their health coverage.