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Health Benefit Ideas for Attracting and Retaining Quality Employees
Today’s workers are less committed to the companies they work for than they were 20 years ago. According to a recent survey from Multiple Generations at Work, 91% of millennials will stay at a job for less than three years—a pace that equates to about 15- 20 jobs over the course of their careers.
Turnover can be extremely expensive for employers when lost productivity and replacement costs are considered. According to the Society for Human Resource Management, it costs, on average, six to nine months’ salary to replace a salaried employee. This figure can be even higher for management and highlevel executives. High turnover can also harm your company’s culture and cause remaining workers to become disengaged and unproductive.
To combat turnover, employers need to get creative and use recruiting and retention techniques that attract and keep employees engaged. Some of these techniques include higher pay, additional vacation time, incentives for high-quality performance, and offering paid maternal and paternal leave.
In addition to these incentives, employers may want to use the following ideas as a cost-effective approach to attracting more loyal and engaged employees.
A Dual Option Health Plan
Employees who are enrolled on the company health insurance plan have different needs according to how they utilize the benefit. An employee who rarely uses the plan would most likely prefer lower cost sharing of the premium, in exchange for a higher deductible. An employee who has high utilization of the plan, would most likely prefer a higher share of the premium, if out-of-pocket expenses such as deductibles and coinsurance are lower. A common fix for employers will be to offer two options for employees to choose from.
• Plan Option A: This option will have a low deductible but premiums that are 10-25% higher than option B.
• Plan Option B: This option will have a much higher deductible with premiums that are 10-25% lower than option A
• Funding: The employer will set a premium dollar amount to contribute, not a percentage of premium. Since the employer contribution is static for each election, the employee’s share of the premium is determined by the plan design of their choosing. This gives the employee the power to choose what is best for them.
Flexible Spending Account (FSA)
With employer-sponsored health insurance costs rising, businesses typically either absorb the premium increase or pass the increase along to employees. Many employers choose to absorb some of the cost while increasing plan deductibles (a cost shift which is paid by employees utilizing the plan).
How can businesses help their employees who may not have $1,000 – $4,000 in the bank to cover a deductible? Consider offering a flexible spending account with a pre-funded debit card.
It works like this:
• The employer sets up the FSA which allows employees to use pre-tax dollars to cover qualified medical expenses (such as their deductible).
• The employee can elect an annual amount they would like withheld pretax from their paycheck. The amount is divided by the number of paychecks per year and withheld each pay period.
• Employees have access to their annual election amount as soon as the plan year starts.
A good FSA administrator who offers debit cards will make the annual election amount available on your employee’s debit cards right away. This allows employees the ability to budget for future health care cost.
Staying ahead of your competition by attracting and retaining the best talent gets easier if you are using innovative benefit strategies that give employees choice and control of their options.
Damian Mochan is the managing partner of Central PA Benefit Solution. He and his team can be reached at 888-238-8515. www.1benefitsolutions.com
To view the full article- Health Benefit Ideas for Attracting and Retaining Quality Employees
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