When assembling an employee benefits package, you may wonder, “What’s the difference between major medical and supplemental insurance?” It’s a common question, and the answer lies in the types of coverage each provides.
Major Medical Insurance
Major medical insurance covers essential health services like doctor visits, hospital stays, surgeries, and emergency care. Employees using this insurance will likely pay a co-pay and a deductible before their coverage kicks in. This type of insurance is often seen as the foundation of an employee benefits package.
Supplemental Insurance
On the other hand, supplemental insurance, also known as voluntary insurance, refers to additional coverage like dental, vision, disability, or life insurance. Sometimes called “gap insurance,” these products fill the gaps that major medical plans may not cover. The great thing about supplemental insurance is that it gives employees the option to pick and choose what fits their personal needs. For instance, dental or vision insurance might be more important for one employee, while another might prioritize disability coverage.
Offering Both Plans
As an employer, you have the flexibility to offer both major medical and supplemental insurance to your employees. While many major medical plans require employers to contribute at least 50% toward the premiums, supplemental insurance plans don’t have this requirement. However, if it aligns with your budget, you can also contribute to supplemental plans. This flexibility lets you create a benefits package that works for both your company and your employees.
Understanding Your Employees’ Needs
When building an employee benefits package, it’s essential to consider the unique needs of your workforce. Every group of employees is different, and their preferences for benefits can vary depending on factors like age, family situation, and lifestyle. Major medical insurance is the top priority for some—they want access to a doctor, co-pays, and coverage for catastrophic events. For others, benefits like paid time off, a 401(k), dental or vision insurance, and life insurance might take precedence.
The key is understanding your employees’ needs and building a package that suits them. You can mix and match benefits to provide a well-rounded offering, ensuring you’re meeting your team’s needs and expectations.
Thinking Outside the Box
A robust employee benefits package doesn’t have to stop at insurance. Think creatively! Offering perks like ice cream socials, a coffee bar, or team-building activities can foster a positive company culture. These extras, along with solid insurance coverage, make your business a more attractive workplace, helping with employee retention and recruitment.
Small Businesses: Don’t Worry!
If you’re a small business with at most 25 employees, you might worry that you can’t offer competitive benefits. That’s not the case! There are many major medical plans specifically designed for small groups, and the good news is that we can help you navigate these options. Whether you have two employees or 25, a plan is available to meet your team’s needs.
What’s Next?
Once you’re ready to start building or enhancing your employee benefits package, we at My HR Pros are here to guide you every step of the way. Whether you’re looking to offer major medical, supplemental insurance, or a 401(k), we can help you tailor a package that fits your budget and your team’s needs.
We also offer benefit administration services to simplify the process for you. From helping employees enroll through the employee portal to managing carrier payments and reconciling bills, we’ve got you covered. And when an employee leaves, we’ll assist with COBRA administration, ensuring a smooth transition.
Tax Benefits of Offering Insurance
Remember the tax advantages of providing benefits to your employees! Offering insurance isn’t just a way to attract and retain talent—it’s also a tax-deductible expense for your business. Additionally, employees can take advantage of pre-tax deductions, lowering their taxable income.
Let Us Help You Build the Right Package
At My HR Pros, we’re committed to helping you build an employee benefits package that works for you and your employees. Whether you’re just starting or looking to enhance your current offerings, our team of experts is here to assist. Reach out today, and let’s start building a package that will help your business attract and retain top talent.