Businesses looking to reduce healthcare costs might consider eliminating ancillary benefits, such as vision, dental, disability and life insurance. But before doing so, there are compelling reasons to continue to offer or add these benefits - either purchased, in part, by the employer or as voluntary benefits with premiums paid by employees.
Many employees value these benefits -- also known as supplemental benefits -- and employers can offer them at little or no additional cost. Along with medical coverage, these supplemental benefits can give employers additional tools and information to help provide proactive outreach to improve workforce health and productivity while more effectively managing costs.
With growing evidence of a link between oral and eye treatments to overall health, as well as to an array of chronic medical conditions, implementing voluntary benefits can prove valuable to both employers and employees. Many health insurers allow employees to select from several plans. Employers subsidize a set amount and give employees the option to pay the difference to enhance or expand their coverage.
This approach provides companies with a predictable and manageable cost, and gives employees the opportunity to purchase added benefits on a pre-tax basis. Benefits, such as critical illness and accident protection, can complement high-deductible medical plans, which have become increasingly popular among many employers. Voluntary benefits can help attract and retain employees while improving workforce moral, according to a 2014 report from LIMRA International.1
These benefits can be especially attractive depending on employee status, such as a participant with two teenagers who need braces or a middle-aged individual with diminishing vision. Voluntary benefits include more than dental and vision coverage. Disability, life insurance, accident protection and long-term care can also be provided as voluntary benefits.
Critical-illness programs, which allocate cash benefits that can be used for living expenses and out-of-pocket medical costs if an employee or family member contracts a specific illness or condition, such as cancer, heart attack, stroke or paralysis, is another example. Combining medical and voluntary benefits can result in more comprehensive and coordinated care that includes wellness initiatives aimed at improving overall employee health.
Health plans that combine and manage medical and voluntary benefits have the ability to reduce the duration of disability claims. Upon filing a critical illness or disability claim, plan participants with a chronic condition, such as cardiovascular disease, can receive additional support and information from a case manager knowledgeable in fitness and nutrition. These additional resources mean employees may get back to health - and work - more quickly.
Other integrated programs encourage preventive dental and vision care and help to stop diseases before they start. A 2012 UnitedHealthcare study, "Integrating Eye Care with Disease Management: It's Not Just About Diabetes Anymore,"2 demonstrated that eye-care providers can play a key role in identifying various diseases.
The study concluded that eye-care practitioners can detect and monitor many chronic conditions, such as diabetes including several unexpected ailments. Eye-care providers can also help detect and monitor multiple sclerosis, tumors, crohn's disease and sickle cell anemia. For some conditions, such as sickle cell anemia, eye care is essential.
For others, such as Crohn's disease, the impact is greatest when a comprehensive eye exam helps care providers identify the condition earlier and track ocular complications caused by medications used during treatment. Eye-care providers can also monitor disease severity and progression for many conditions including high cholesterol, rheumatoid and juvenile rheumatoid arthritis, Graves' disease, AIDS and lupus.
Many employers are integrating vision and medical benefits into programs that support patients and healthcare professionals with information, decisions and outcomes. These programs can include a variety of features, such as:
- Eye-care practitioners can be encouraged to code claims with chronic condition categories. Those diagnoses automatically are referred to disease management programs for follow-ups based on patient needs.
- Eye-care practitioners can be notified at-risk conditions during the exam authorization process and make recommendations during a comprehensive examination including fundus tests that use drops to dilate pupils and gain a better view of the eye.
- Patients with diabetes, diabetic retinopathy, hypertension, hypertensive retinopathy, vascular disease or high cholesterol can be notified with a phone call, which is more effective than a postcard reminder, about the importance of their annual eye exam.
- For patients who may have chronic conditions, referrals to primary care providers or specialists can be supported via specially designed forms available online to eye-care practitioners.
Dental and medical benefits also can be integrated. From 2008-20011, UnitedHealthcare studied the dental claims of more than 130,000 plan participants enrolled in both employer-sponsored dental and medical plans. The study showed that improving the oral health of patients with chronic medical conditions, such as diabetes, asthma and cardiovascular disease, can reduce healthcare costs.3
People with certain chronic conditions who received appropriate dental care including preventive services and the treatment of gum disease proved to have net medical and dental claims on-average $1,038 lower per year than those for chronically ill patients who did not receive similar oral care. Among diabetics, the average annual net for medical and dentals claims was $1,279 lower per person for individuals who were treated for gum disease compared to those not.
The savings for all groups were achieved even after accounting for the additional cost of dental care. Among other findings: Total average medical costs were lower across all chronic conditions for people who received periodontal treatment or cleanings compared to those who did not, even after accounting for the costs of additional dental treatments.
People with chronic conditions who received regular cleanings -- at least three during the three years -- had the lowest healthcare costs of any other dental treatment group (i.e., infrequent cleanings or no cleanings). Savings were significant even for those who received regular dental care, but were not compliant with the recommended treatment for their chronic medical condition.
Among the groups receiving dental care, annual average medical costs were $2,320 lower than those who did not, with net savings of $1,829 after accounting for the cost of dental care. Besides dental and vision coverage, employers may consider programs that help their employees address hearing loss, a significant concern of more than 48 million Americans, 60 percent of whom are still in the workforce or attending school.
A growing number of private health insurance plans and hearing aid companies provide discounts to make these devices more accessible and affordable. Hearing aids can help more than 90 percent of those afflicted with hearing loss; however, they can cost up to $8,000 a pair, making them unaffordable for many. Addressing hearing loss can foster a healthier, more productive workforce.
New research shows that hearing loss is associated with a range of physical and mental health issues including increased falls, social isolation and even dementia. People with hearing loss are more likely unemployed, while those untreated and employed earn about 25 percent less on-average than those without the diagnosis, according to a study published in the Annals of Otology, Rhinology & Laryngology.4
Hearing loss may also affect a patient's ability to fully understand recommendations provided by their health professional, influencing adherence and, in turn, their ability to manage their health. Voluntary benefits maximize the effectiveness of a company's healthcare dollars and, when offered alongside medical insurance to employees, provide families with added peace-of-mind for both their health and financial protection. Employers that combine voluntary and medical benefits may be able to reduce turnover, increase productivity and build a culture of health.
About the Author
Philip Kaufman is president of UnitedHealthcare Specialty Benefits, which provides a full spectrum of consumer-oriented health benefit plans and services to individuals, public-sector employers and businesses of all sizes including more than half of the Fortune 100 companies.
1. "LIMRA Study Finds Employers Interested in Offering Voluntary Benefits": LIMRA; Sept. 15, 2014; http://www.limra.com/Posts/PR/News_Releases/LIMRA_Study_Finds_Employers_Interested_in_Offering_Voluntary_Benefits.aspx; Accessed July 29, 2015.
2. Chous, M.L., Christopher, K.K.; "Integrating Eye Care with Disease Management: It's Not Just About Diabetes Anymore"; UnitedHealthcare;2012; www.uhc.com/content/dam/uhcdotcom/en/Employers/PDF/EyeCare_DiseaseManagement.pdf; Accessed July 29, 2015.
3. Ambroken, D., Lepsky, S., Reich, H., Stender, S.; "Medical Dental Integration Study; United Healthcare; March 2013; http://www.uhc.com/content/dam/uhcdotcom/en/Private%20Label%20Administrators/100-12683%20 Bridge2Health_Study_Dental_Final.pdf; Accessed July 29,2015.
4. Hogan, M.; "Hearing Loss Linked to Unemployment, Lower Income";The Hearing Journal; February 2013; Vol. 66; Issue 2; http://journals.lww.com/thehearingjournal/Fulltext/2013/02001/Hearing_Loss_Linked_to_ Unemployment,_Lower_Income.2.aspx; Accessed July 29, 2015.