Health Insurance Benefits

A good modern approach to compensation and employee health insurance benefits rewards and recognizes your best employees. Effective health insurance benefits for employees raise productivity, increase employee retention, and tend to have a positive impact on the bottom line.

So the question is if you, the employee, are receiving the best benefit from your health insurance benefits provided by your employer? Is it the type of payback you deserve and does it show that you are being appreciated?

Odds are, according to the numbers, you aren’t.

On average, organizations spend 41 cents for benefits for every dollar of payroll, making it only 29% of the total employee compensation package. Studies suggest that employees only understand and appreciate between 31% and 68% of the cost of the market value of the health insurance benefits they get.

There are a few reasons employees undervalue their health insurance benefits. Employers do a poor job of communicating and explaining the value of these health insurance benefits. The employees might also have little or no choice in their health insurance benefits packages or options. And, finally, the employees may misunderstand the market value of their health insurance benefits.

An employer can help this situation by allowing employees to make choices and to provide lots of information. They might jumpstart the education process by providing paycheck inserts that detail the costs for employee health insurance benefits. Other more outside-the-box and creative ways to get employees thinking about their health insurance benefits are using interactive computer quizzes, benefits fairs, telephone hot lines, workplace posters, video tapes, and television.

It might also be useful to survey employees and ask them which health insurance benefits they value the most and how much. This helps in understanding employee preferences. Possible relevant questions might include:

1. Which health insurance benefits are the most important to you and your family?
2. If you could choose any new health insurance benefits, what would they be?
3. If you were given X amount of dollars for health insurance benefits, how would you spend them?

Off of this data, employers can adapt their health insurance benefits and provide choices more consistent with what their employees want. It certainly can help raise employee retention and performance.

Remember that there are a wide variety of health insurance benefits available in today’s world. A few, like medical and retirement benefits, have become expected with any job. Many others are not and these are the health insurance benefits that will set a company apart. An organization’s values tend to show themselves in the health insurance benefits they offer to their employees. So they help to establish an organization’s positive reputation in the marketplace.

With all this in mind, an employer should reconsider the health insurance benefits his company offers. If an employer can determine what health insurance benefits would be most valued by and useful to his employees then he’s gaining a competitive edge. It all starts with communication and simply rewarding employees for all their hard work. They’ll certainly appreciate it, especially when it comes to their work performance and if they were thinking about leaving. Give them a reason not to.