Discussing health insurance causes anxiety for a lot of people, sending some into a bona fide fit of rage. Signing up is complicated, understanding benefits packages can be mind boggling, and access is often limited by cost.
For many employers, offering health benefits isn’t a matter of desire; financial limitations and logistics are too much to overcome. Over time, these barriers may lessen, especially as new resources continue to arise for streamlining the process of coordinating care plans.
Companies that find a way to improve access to insurance can experience abundant payoffs. Employees are often motivated to stay longer with a company, incentivizing growth along a career trajectory. Benefits packages also offer resources for improved quality of life, in return cultivating a work culture comprised of employees who are better equipped to perform well in their jobs.
CASE ONE: HUCKLEBERRY ROASTERS
Huckleberry Roasters recently rolled out a benefits plan for its employees, but it took several years to find the right option.
“It was way more complicated and convoluted than a business owner needs it to be because of all the moving pieces,” says Mark Mann, co-owner of the Denver, Colorado-based roasting company.
The leadership team at Huckleberry was always interested in offering benefits, but hadn’t been able to find a plan that made sense for their available resources, both logistically and financially. After continuing to hear from employees about the challenges of signing up for individual benefits, it was clear that demand was high, and providing health care became a priority for the company.
Huckleberry was already working with Gusto, a web-based human resources service, for payroll and scheduling. When Gusto rolled out a benefits platform through its Denver office, a simplified path to implementing a benefits program was finally available.
“We like technology to make things more simple for us,” Mann says. “Gusto was just that; they made it more simple for us to do.”
Huckleberry employees working twenty-nine hours or more qualify for benefits after sixty days of employment. The company covers 75 percent of premiums for the Kaiser benefits package, leaving employees responsible for the remaining 25 percent.
But health insurance is just one component of Huckleberry’s efforts to improve overall health and well-being for staff. The company is also on track to raise hourly wages to fifteen dollars over the next two years. “[Denver] is continuing to be a very expensive place to live,” Mann says. “It’s harder to make life work even at the salary we pay, let alone flourish as a person.”
The push to improve quality of life also includes offering a bike incentive program for employees who commute by bike (with a helmet), as well as memberships to a local rock climbing gym. Mann says in the future, they also hope to provide options for employees to donate to nonprofits, also facilitated by Gusto. In an industry notorious for being transitional, Mann says Huckleberry hopes to see better quality of life translate into improved retention, and an overall change in perspective about the prospect of a career in coffee.
“Trying to shift [coffee] from being transitional to career-focused has been a motivation of ours,” Mann says. “It’s trying to get people to realize how many more opportunities there are.”
CASE TWO: PABLO’S COFFEE
Across Denver at Pablo’s Coffee, benefits have certainly helped with retention, though insurance is just one of many factors contributing to a positive work environment.
Pablo’s rolled out health benefits in 2015, a group policy to which the company contributes a fixed amount, generally about half of the premium. “Before the Affordable Care Act [ACA], the group plans available to us were typically twice the price of quotes for individual plans, so for many years it was just silly to form a group plan,” says Pablo’s owner Craig Conner.
In addition to health insurance, Pablo’s employees have access to a 401(k) program—with a 3 percent match rate—after one year of employment. Staff also have access to free Barista Guild of America (BGA) memberships, which has led to more than half of the Pablo’s team completing BGA Level 1 certification.
“Our good fortune in keeping people around is many fold,” Conner says. “Of course seeing a 401(k) account grow lends itself to a sense that the future has a little cushion, and that helps.”
Employees also earn paid vacation: one week after the first year of employment, with additional weeks earned in subsequent years (Pablo’s has a number of employees who qualify for five weeks paid vacation, earned from eight years of employment.)
“Work culture is a strange beast,” Conner says. “If everyone can leave work feeling good about the day and has a pretty good idea of what awaits them the next day, it goes a long way toward being fulfilled.”
Conner also says that ultimately, interaction between employees and customers is the driving force behind culture, morale, and long-term success. “In the end, it’s people who take care to respect their customers and coworkers that keeps things from growing too forced or litigious.”
THOUGHTS FROM A PAYROLL COMPANY
I asked Gusto’s Steffi Wu to shed some light on common barriers between employers and benefits plans, as well as the payoffs from offering a wellness package.
What factors keep employers from providing benefits to employees?
Benefits are expensive. Period. And not just financially. Setting up and managing employee benefits can be a huge administrative burden. Benefits come with a high overhead from having to find a broker, research providers, select a package, and file paperwork for every employee. Benefits administration is also complex. Carrier documents are hard to decipher, there are thousands of plan options to choose from, and it’s a headache to stay on top of ever-changing compliance regulations.
What should employers know about the advantages of offering a benefits program?
Benefits pack a big punch. They show that you truly care about your team’s well-being and success, both inside and outside the workplace, and the payoffs don’t stop there. For one, it helps you attract awesome people, and retain the talent you recruit. You also benefit from tax savings—since your contributions are a business expense, they’re tax deductible. Additionally, the amount that your team pays toward their premiums is done on a pre-tax basis, which means that they have lower taxable payroll earnings, so your payroll taxes are lower. Employees pay lower taxes, too. And of course, offering benefits is a great way to reinforce your company culture and sense of community. In fact, half of the employees polled in a study by MetLife said that benefits helped them avoid worrying about their financial future and overall health.
What options are available to employers who want to add a benefits program through Gusto?
Whether you’re offering health benefits for the first time or offer them already, we’ve got you covered. Currently, health benefits are available in seventeen states and counting: Arizona, California, Colorado, Florida, Georgia, Illinois, Massachusetts, Maryland, Michigan, New Jersey, New York, Ohio, Oregon, Pennsylvania, Texas, Virginia, and Washington.
Employers can also offer more employee benefits through Gusto including 401(k) retirement plans, 529 college savings, commuter benefits, a flexible spending account (FSA), a health savings account (HSA), dependent care FSA, and life and disability insurance.
Who should employers consult to better understand the unique benefits requirements of their state?
Your health insurance broker is your go to. A health insurance broker is a licensed benefits pro who can help you research, buy, set up, and manage your health insurance experience from start to finish, and can help you understand exactly what you need to do to stay compliant with your state.
TIPS FROM AN INSURANCE AGENT
Who are your employees, and where are they going for care? When you begin to shop around, it’s important to have an understanding of the healthcare needs of your employees, and what kinds of providers they seek for care. Age of employees also matters: providing benefits for a young staff will be much less expensive than benefits for a staff in their forties, fifties, and sixties.
Try to keep premiums for employees as low as possible. High premiums prevent many companies from offering benefits packages, but there are lots of options to lessen the financial burden of premiums.
Consider a Health Reimbursement Arrangement (HRA). If high premiums are keeping you from signing up for a group plan, an HRA allows employers to reimburse employees (tax free) for dollars spent meeting premiums or from out-of-pocket medical expenses. This system helps employers save on premiums, while minimizing the financial impact on employees.
Consult an insurance agent. Insurance agents work on commission from insurance companies, so they are a free resource to employers. Agents have better oversight of all that’s happening in the insurance world, and can better match a company with a plan suited to the needs of its employees.
Sarah Rech is an insurance agent with Professional Benefit Services, based in Oregon (Rech helps Fresh Cup coordinate healthcare for its employees).
—Ellie Bradley is Fresh Cup‘s former editor, now a freelance contributor from her new home base in Colorado.