Originally published at www.linkedin.com.
Once again, open enrollment season is upon businesses, and human resource departments globally. CEO’s, Directors of Human Resources, and Human Resource Managers, are all analyzing the latest trends in healthcare. This time of year is a wonderful opportunity for organizations to review their benefit options and make changes to lower cost, (we can only hope right?) or offer more benefits than the previous year.
The importance of making sure that you choose the right benefit options for your organization grows every day. In today’s business market, employees no longer solely focus on salaries when deciding on job offers, they want to know the culture, career development, and benefits (medical, leave, time off, disability, and life insurance) before making a career choice. As healthcare costs continue to increase, most business owners do not have the time or the knowledge to navigate the Affordable Care Act.
Small businesses have a choice: they can offer a robust, competitive benefits package and use profits to cover the cost, reduce benefit offerings and risk losing talent, or offer a mixture of employer sponsored benefits and voluntary benefits the employee covers completely.
With these three options in mind, which choice is right for your workforce?
What I recommend to small businesses:
Offer health insurance, retirement savings plans, and some form of life and disability insurance. Specialty benefits such as vision and dental are a great plus for employer sponsored or employee paid coverage.
Most small businesses lean toward high-deductible plans that carry lower premiums but force employees to pay more treatment costs upfront before the insurer kicks in. Small business owners should speak with their broker to discuss how they can lower costs for their companies or their employees. Experiment with offering multiple plans for employees to choose from for health savings accounts. Lastly, have your broker look in “level-funded” plans, a growing third option for small businesses to consider.
More and more small businesses are offering retirement plans for their employees. Most companies choose a defined contribution plan such as a401 (K), rather than a pension-a defined benefit plan. 401 (K) plans encourage employees to invest in their future and take ownership of their retirement goals, with the help of their employer. Most small businesses also match a certain percentage of what employees contribute, and divert 5–10% of their pay to a 401 (K). The amount that employers match may vary, but most hover around 3–5 %. Be sure to establish eligibility requirements, such as time of service with the company.
There are benefits that supplement your small businesses insurance offerings that can be of no cost to you. Small business owners offer these supplemental policies and employees can choose which benefit is right for them. Companies such as AFLAC offer policies like Short-Term Disability, Long-Term Disability, Life, Dental, Vision, Hospital Confinement, Cancer, or Accident to employees at NO COST TO THE EMPLOYER!
Employees love these products because they can take these policies with them if they ever leave their employer.
Do not be afraid to speak with your current broker and tell them your business objectives. If you are looking to lower your costs, you should say so. It is their job to listen to your business needs! Find a broker who will provide you with a dedicated account manager or support to help walk you through the finer points. Do not be afraid to shop for other brokers and see what others may be able to offer your company.
CATMEDIA’s Human Resource management objectives are simple: utilize an individual’s talents to achieve organizational objectives. We provide high-quality personnel to meet the short-term and long-term needs of our clients through creative staffing, human capital management, and staff augmentation services.