How Far Is Too Far for Employee Benefits?

Do you remember when employee benefits were limited to major medical and pension plans? It seems such a long time ago. Today, employee benefits extend to things that were previously off-limits. And in light of the impact coronavirus has had on nearly every aspect of life, employers are looking to expand benefits packages even further. Can they go too far?

Dallas-based BenefitMall published a compelling blog post in late July 2020 discussing some of the more important trends in employee benefits – particularly healthcare – for 2020. It was right in the midst of the pandemic’s peak. As we approach the end of 2020, the main points of the post are still relevant. Yet we can already see employee benefits far surpassing the trends BenefitMall observed.

BenefitMall published a compelling blog post

Hospital Indemnity Plans

So what are the benefit trends heading into 2021? The Washington Post’s Jena McGregor offered a few insights in a December 2 post discussing how coronavirus has shifted our thinking on employee benefits. One of the more interesting things McGregor mentioned was something known as the ‘hospital indemnity plan’.

A hospital indemnity plan is more or less a critical illness insurance policy that pays out in the event the policyholder is hospitalized. In terms of coronavirus coverage, some employers are speculating that hospital indemnity plans will be attractive as voluntary benefits that do not cost them anything out-of-pocket.

A typical plan would offer employees the opportunity to set aside some of their earnings to pay for critical illness insurance. In the event they are hospitalized by a serious illness, the policy would pay a lump sum to cover lost wages and healthcare costs.

Prepaid Legal Plans

Another idea floated by McGregor is the prepaid legal plan. She says employers are starting to look at giving their workers access to prepaid legal services in an effort to encourage them to get end-of-life affairs in order. Under normal circumstances, encouraging employees to think about such issues would be completely normal. But in the coronavirus era, encouraging prepaid legal plans might only reinforce fears of dying from COVID-19.

A prepaid legal plan, like hospital indemnity insurance, would be a voluntary benefit that employers offered at no additional cost to them. Employees would set aside money they would later use to pay attorney’s fees. The money could go toward preparing a will, establishing a trust, etc.

Couples Therapy

McGregor says that even couples therapy is on the table for 2021 employee benefits. If you are not sure why, it is rooted in the amount of time people are now spending at home. As the thinking goes, couples spending more time together increases the chance of conflict between them.

Apparently, couples therapy is attractive to companies that employ significant numbers of married couples. They understand that marriage difficulties affect two employees rather than one, so finding a way to help resolve marital conflict could limit any damage such conflict could cause in the workplace.

Where to Draw the Line

It is important to note that most of the benefits discussed in McGregor’s post are voluntary benefits. They do not cost employers anything. The employer’s only task is to give workers access to the benefits at a cheaper cost than they could get by themselves.

Having said that, it bears considering whether or not there is a line that should not be crossed. All three benefits discussed in this post – hospital indemnity plans, prepaid legal plans, and couples therapy – are directly related to personal fears and perceptions rather than tangible risk. Are we feeding those fears and perceptions by offering such benefits? And if so, is that a bridge too far?

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