The Importance of Keeping Benefits Top of Mind for Small Businesses

By Michael Tomlinson

According to the SBA, there are 28 million small businesses in the U.S., with many exploring cost-saving strategies to address today’s health-care landscape as it continues to evolve. These strategies can include scaling back or rethinking employee benefits programs altogether. According to the 2014 Aflac WorkForces Report (AWR), 17 percent of businesses said they eliminated or cut back on benefits in an effort to control costs last year.

However, before you adjust your company’s benefits programs, consider that they can be vital to both employees’ job satisfaction and their financial security. In fact, according to the AWR, 75 percent of small-business employees believe benefits are extremely important to job satisfaction, and only 15 percent of workers indicated they were extremely or very prepared to pay out-of-pocket expenses related to a serious illness or accident that is not covered by major medical insurance.

If you are planning to adjust your small business’ benefits program, here are three best practices to consider that will allow you to create some cost savings without disappointing employees or reducing the benefits plans on which they rely:

1. Health Insurance Exchanges

Marketplaces have become an increasingly bigger piece of the employee benefits equation because they can offer a mix of benefits products and help reduce an employer’s time and money spent on administration and paperwork. Not only do private exchanges make benefits administration easier for small businesses, they also give employers the option to purchase health care coverage that fits their needs and budget.

As an added benefit, if a small business has fewer than 25 full-time employees, they may be able to take advantage of tax credits through government exchange options.

2. Online Benefits Enrollment

Generally, small-business employers use face-to-face methods of benefits communication, such as workplace presentations and one-on-one sessions, with benefits professionals. However, using online enrollment methods can help cut back on benefits costs by making enrollment more convenient for employees and reducing time spent on paper forms. In fact, from 2011 to 2014, employees using online enrollment methods at small businesses increased by 62 percent.

Making online enrollment available can offer a more flexible process for employees and can easily complement existing face-to-face communication methods.

3. Voluntary Insurance

Employees are gaining new-found benefits choices; however, many are not prepared to take on increasing out-of-pocket health-care costs. This is where employers can step in and help protect their employees by adding voluntary policies to their overall benefits packages.

Voluntary insurance can be used in any way a policyholder sees fit (unless otherwise assigned) – whether it’s to help pay out-of-pocket medical expenses that major medical policies don’t cover or to help pay the bills that keep rolling in when an employee is sick or hurt and cannot work.

What’s even better is that providing voluntary insurance does not put any additional costs on the employer’s plate. These benefits help provide an extra layer of financial support by paying cash benefits directly to the policyholder and offer a broader benefits package to the diverse workforce that exists today.

Bottom line

Looking for ways to change benefits options can be tricky, but with the right resources and research, small businesses can increase health care offerings while still controlling costs.