Voluntary Healthcare Solutions For A Post-Covid Hourly Workforce

As industry slowly ramps back up, many employers are rethinking their entire workforce strategy

By Eric Silverman

While unemployment among all groups of workers increased sharply in the COVID-19 recession, part-time workers are amongst the hardest hit. And although the U.S. economy is slowly coming back to life, the economic fallout of the coronavirus pandemic is far from over.

Companies are moving forward cautiously, and many are rethinking their workforce strategy. According to a Gartner study, 32% of organizations are replacing full-time employees with contingent workers as a cost-saving measure.^[1] For a variety of reasons, companies are also shifting toward more flexible work options and away from the traditional 40-hour work week, creating a greater need for a part-time workforce.

While ACA-compliant coverage provides the most comprehensive medical insurance coverage, in today’s post-COVID world as employers struggle to re-staff their workforce and protect their bottom line, it may be a cost-prohibitive option for many companies. Even if employers offer ACA-compliant programs, the employees’ share of major medical insurance premiums and the accompanying out-of-pocket obligations can make these plans too expensive for many minimum wage workers. In many instances, employees are deciding not to purchase the traditional health insurance, even when offered by their employer.^[2]

Employers who want to offer benefits to part-time employees but cannot bear the costs of traditional health plans may consider less comprehensive, lower cost insurance products, like MEC plans, accident, critical illness, and hospital indemnity insurance. These products provide some protection but do not provide coverage for the everyday medical expenses, leaving employees at risk.

Limited Fixed Indemnity Medical (LM) policies offer flat rates for day-to-day expenses (with no deductibles), and the coverage can actually cost the employer nothing. In addition to providing a fixed benefit for day-to-day expenses like doctor’s office visits, hospital services, surgical procedures, and hospital stays, some carriers also offer packages with life, disability, vision, dental, and other voluntary products.

Flexible plan designs allow for customizable programs, tailored to meet individual client need. This allows employers to provide higher benefits in areas of the country that have higher health care costs. Some carriers even offer access to a national discounted medical and prescription drug network, as well as dental, vision, life, and disability benefits – all for one low weekly rate.

Features may include the following:

• No pre-existing condition limitations
• No medical underwriting
• No deductibles
• Dependent coverage for all plans
• No coordination with other plans
• Coverage for physician office visits, hospital services, surgical procedures, and more
• Claims filing by in-network providers
• Top-rated provider networks
• Virtual visits are covered
• Mental Health visits are covered
• Cobra Administration

While these fixed benefits may offer an employee less than what is typically seen in a major medical health insurance plan, the coverage is available at a fraction of the price. I’ve even seen one carrier say they strive to build a plan with weekly rates that equal two times the average hourly wage of the workers. And employers can pay for some – or none – of the premium.

With flexible enrollment options (online, paper, call center) and administration that can typically be done on a weekly or bi-weekly basis to match payroll cycles, offering this coverage to employees is easier than ever. Another carrier even waives premium for weeks the employee does not work, and back premiums only have to be paid if a claim is filed during that time period.

What Industries Are Ideal Targets?

Ideal targets for LM include industries with a large intermittent population such as restaurants, hotels, retail, franchise groups, grocery stores, banks, and companies increasing their hourly and intermittent employee population.

With employers trying to attract and retain employees while shoring up their budgets, LM is a solution worth exploring. Reach out to me to learn more – I’m happy to help facilitate an introduction to any of my top tier solution providers in this space.

Until next time, don’t just have a great month – make it a great month!

[1] https://www.gartner.com/smarterwithgartner/9-future-of-work-trends-post-covid-19/

[2] https://www.nytimes.com/2015/10/20/business/many-low-income-workers-say-no-to-health-insurance.html