Less than half of employees are aware of supplemental group insurance
benefits designed to help them manage the unexpected expenses of an
injury or illness, survey finds
With deductibles continuing to climb, many Americans who have health
insurance through their employers, particularly younger workers, are
struggling when it comes to out-of-pocket medical expenses.
According to a new survey from Securian Financial Group, a provider of
supplemental group insurance products, nearly four in 10 workers on
employer-sponsored health plans are personally experiencing or know
someone who is having financial difficulty due to medical bills.
Notably, more than half (52 percent) of Millennials on a health plan
through their employer are personally struggling or know someone who is
struggling to pay medical bills.
While solutions for combating unexpected medical expenses are available,
most workers do not know about them. The survey found that fewer than
half of Americans with health insurance through work (44 percent) are
aware that many employers provide supplemental group insurance options
to help employees pay for out-of-pocket expenses and other costs
associated with an accidental injury, hospital stay or critical illness.
“The rising cost of health care has driven many employers to offer
supplemental group insurance products, often in conjunction with a
Health Savings Account,” said Elias Vogen, a director with Securian.
“This combination can be cost-effective for both employer and employee,
and our survey shows that when employees are aware that these benefits
are available to them through work they opt in at a high rate—64 percent
for accident insurance, 59 percent for hospital indemnity insurance and
47 percent for critical illness insurance.”
A unique kind of coverageBenefit payouts for supplemental
group insurance—often referred to as “voluntary benefits” because
employees typically pay the full cost of premiums but at a discounted
group rate—are provided in a lump sum to help cover a range of expenses,
not just out-of-pocket medical bills. This relieves a key concern for
employees: While the survey revealed that paying for out-of-pocket
medical expenses would be the top financial concern for a plurality (42
percent) of workers facing a debilitating injury, a critical illness
diagnosis or a hospitalization, 58 percent say their top concern would
be lost wages from work, the ability to pay for regular monthly expenses
such as groceries, or the need to take on additional expenses such as
lawn care or cleaning.
“If you break your leg, or your critically ill spouse needs specialized
medical care out of state, these benefits can be used to help pay for
expenses like hiring out your household chores, paying for travel costs,
extra child care and more,” said Vogen. “You don’t have to turn in your
receipts; you’re able to use the funds as you wish. The flexible nature
of these benefits can be instrumental in warding off financial troubles
from an unexpected health event.”
The toll of out-of-pocket medical expensesAccording to the
survey, 28 percent of employees with health insurance through work
facing an out-of-pocket expense of $5,000 or more would use their
personal savings to pay rather than other means, including a Health
Savings Account (8 percent) or supplemental group insurance (7 percent).
However, a majority of respondents said they do not know how they would
pay (21 percent), or that they would need to rely on credit cards (12
percent), a loan from their 401k (7 percent) or family/friends (4
percent), their tax return (5 percent), or by selling/pawning a personal
possession (2 percent). Four percent said they would not pay at all.
Other survey findings include:
Over the past year, Millennials (32 percent) on employer-sponsored
health plans with deductibles are the most likely age group to have
paid out-of-pocket expenses for an accidental injury like a broken
bone or laceration when compared to Generation X (18 percent) and Baby
Boomers (16 percent).
Among low-income Americans (household income of $35,000 or less) with
health insurance through work, 55 percent report knowing someone or
personally having financial difficulty due to medical bills.
Across all generations, 31 percent of workers with employer-sponsored
health insurance report having paid or knowing a family member who has
paid an unexpected out-of-pocket medical expense in the past five
years due to a critical illness such as cancer, a heart attack or
“Employers recognize that health care costs have become burdensome to
their workers and their families, and it’s important to remember that
these cost increases have impacted employers’ bottom lines as well,”
said Terry Holloway, an employee benefits advisor and executive vice
president with insurance broker Cobbs Allen. “Supplemental group
insurance benefits are a cost-effective solution for both employers and
employees. We have seen a significant increase in employer interest in
these and other voluntary benefit platforms in the past five years,
along with innovative enrollment solutions from insurance carriers.”
Securian’s survey was conducted online by KRC Research from June 8 to
June 12, 2017. A total of 1,010 survey respondents answered an initial
screener question on the source of their health insurance. The rest of
the survey was answered by a base of 573 respondents who participate in
a health insurance plan provided by their employer or their spouse’s
employer. The sample was weighted by demographics such as age, gender,
race, region and income to ensure reliable and accurate representation
of the national population age 18 and older.
Group Insurance FactsheetSecurian
Supplemental Group Insurance BenefitsSecurian
Benefits Survey Report
About Securian Financial GroupSince 1880, Securian
Financial Group and its affiliates have provided financial security
for individuals and businesses in the form of insurance, investments and
retirement plans. Now one of the nation’s largest financial services
providers, Securian is the holding company parent of a group of
companies that offer a broad range of financial services.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170717005706/en/
Securian Financial GroupJeff Bakken, 651-665-7558Media