More Employers Are Rethinking Supplemental Health Benefits and Employee Financial Wellbeing
For more than two decades, supplemental health benefits have followed a familiar formula.
Employers make accident, critical illness and hospital indemnity coverage available during open enrollment. Employees decide whether to participate. Brokers educate. Carriers underwrite. Enrollment percentages become the measure of success, and the process repeats the following year.
It's a model the benefits industry knows well.
Today, however, more employers are beginning to ask whether it's still the right model for today's workforce.
Not because the benefits lack value. In fact, most employers recognize that these supplemental health benefits can provide meaningful financial support when an employee experiences a serious illness, accident or hospitalization.
The question is whether the way those benefits have traditionally been delivered still makes sense for today's workforce.
The Challenge Was Never the Benefits
One misconception surrounding supplemental health benefits is that employers have been unwilling to invest in them.
Kyle Frigon, Chief Commercial Officer at BeneRe, sees it differently.
"Employers weren't saying these benefits didn't matter," Frigon explained during a recent interview. "They couldn't clearly see the value they were receiving."
The issue wasn't the coverage itself. It was the inability to measure whether the investment was actually delivering value for employees and employers.
For years, employers had limited visibility into claims performance, employee outcomes or how much of every premium dollar ultimately benefited employees. Supplemental health benefits were often viewed as voluntary products managed outside the broader benefits strategy rather than as an extension of employee financial wellbeing.
Without transparency, it was difficult to build a compelling business case for doing something different.
A Market That Has Changed
The environment employers face today looks very different than it did 20 years ago.
Over the past two decades, the environment surrounding employee benefits has changed dramatically. Healthcare costs continue to climb, employees are taking on greater financial responsibility through higher deductibles and out-of-pocket costs, and employers are under increasing pressure to provide meaningful benefits without significantly increasing overall spending.
At the same time, technology has transformed benefits administration. Digital enrollment, improved claims reporting and more efficient underwriting now provide employers with a level of transparency that simply wasn't available in the past.
That increased visibility is changing the conversation. Rather than focusing solely on enrollment, employers are asking a broader question: How well are our supplemental health benefits actually providing employee financial protection?
During recent discussions with employers at industry events, one theme surfaced repeatedly: employers want more transparency, better outcomes and greater accountability for how benefit dollars are working for employees.
Those conversations extend beyond supplemental health benefits. They reflect a broader shift in how employers evaluate every component of their benefits strategy.
Looking Beyond Enrollment
Historically, success in the supplemental health market has been measured by participation.
How many employees enrolled?
How effective was the enrollment campaign?
What percentage elected to enroll for coverage?
While participation still matters, it doesn't effectively measure whether employees have meaningful financial protection when they need it most.
Lamont Thurston, BeneRe's Founder and CEO, believes employers are beginning to ask a different question.
"For years, the industry has focused on enrollment," Thurston said. "The better question is how many employees are actually protected."
That distinction changes the conversation.
If only a small percentage of employees enroll, the majority of the workforce remains financially exposed when a serious health event occurs. For employers focused on workforce wellbeing, resilience and retention, that's becoming a harder outcome to accept.
Why BeneRe Took a Different Path
Long before BeneRe 100 – a group captive program designed to make supplemental health benefits accessible to companies with 100 or more employees – was developed, the company's leadership believed the traditional voluntary model could evolve.
The original BeneRe program demonstrated that a more transparent funding approach could return more value to employees while helping employers better understand where benefit dollars were going.
The challenge was scale.
Large employers often have resources, buying power and administrative capabilities that smaller organizations simply don't. Extending the same philosophy to employers with 100 to 2,000 employees required a different approach – one that was simpler to implement, easier to administer and designed specifically for the realities of the mid-market.
"We didn't want to build a smaller version of our flagship program," Frigon said. "We wanted to build the right solution for employers in this market."
That meant simplifying implementation, working with carrier partners to create efficient, pre-underwritten plan designs and preserving the principles that had always defined BeneRe: transparency, employee value and long-term sustainability.
A Different Way to Think About Employer-Provided Protection
One idea surfaced repeatedly throughout conversations with employers, brokers and carrier partners while BeneRe 100 was being developed.
Most employers already invest in benefits they believe are fundamental to protecting employees and their families. Medical coverage, dental, vision and basic life insurance are widely accepted as part of a comprehensive benefits strategy.
Yet supplemental health benefits have traditionally been treated differently – not because they are less valuable, but because they've historically been viewed as optional employee elections rather than an extension of an employer's overall commitment to financial wellbeing.
Frigon believes that assumption deserves another look.
As deductibles continue to rise and employees absorb more financial responsibility, the conversation is gradually shifting from whether supplemental health benefits should simply be offered to how employers can provide broader financial protection for their workforce.
That shift won't happen overnight, nor will it be the right strategy for every employer.
But more organizations are beginning to evaluate employer-funded supplemental health benefits alongside the rest of their core benefits strategy rather than viewing them as standalone voluntary benefits.
Expanding Access, Not Changing the Mission
BeneRe 100 wasn't created because BeneRe wanted another product in its portfolio.
It was created because the company's mission never stopped with large employers.
"The goal was never to stop at 1,000 employees," Thurston said. "The goal was always to make this model accessible to more employers without compromising the principles that made it successful."
For employers with 100 to 2,000 employees, that represents something new.
Not simply another supplemental health offering.
A different way to think about protecting employees.
And perhaps more importantly, a different way to think about the role supplemental health benefits can play in helping employees navigate one of the greatest challenges facing today's workforce: the growing financial impact of healthcare.
Understanding the Importance of Supplemental Health Coverages
What are supplemental health benefits?
Supplemental health benefits, including accident insurance, critical illness insurance and hospital indemnity insurance, pay cash benefits directly to employees following a covered illness, injury or hospitalization. They help offset deductibles, out-of-pocket medical costs and everyday expenses that can accompany a serious health event, providing an added layer of financial protection beyond major medical coverage.
What is the difference between voluntary and employer-funded supplemental health benefits?
Voluntary supplemental health benefits are typically offered to employees, who decide whether to enroll and pay the premium. Employer-funded supplemental health benefits are provided by the employer, extending financial protection to more or all eligible employees. With today's underwriting, plan design options and funding models, many employers find they can provide broader coverage at a cost that is more affordable than they might expect.
Why are more employers rethinking supplemental health benefits?
As healthcare costs continue to rise, employers are looking beyond enrollment rates to evaluate whether their benefits strategy delivers meaningful value. Many are discovering that employer-funded supplemental health benefits can strengthen employee financial protection while, in some cases, helping optimize overall benefits spending through more efficient funding and plan design.