Employee paid cash plans still appeal to staff

Promoting the merits of a healthcare cash plan to staff can be uncomfortable if they are footing the bill, but many employees will still regard the offering as a substantial perk, says Sam Barrett

Promoting an employee-paid healthcare cash plan can feel uncomfortable, especially as it can deliver benefits to employers as well as staff. But, providers and consultants are keen to dispel any such concern.

Debbie Roberts, senior consultant at independent specialists PMI Health Group, says: “Even though [staff] have to pay themselves, employees do still regard cash plans promoted through their employers as a benefit. Generally, because the employer is doing some of the marketing on the provider’s behalf, [staff] will get better terms on a organisation-sponsored scheme than if they had bought direct.”

These improved terms can either be in the form of a better level of benefits, a keener price or both. Westfield Health, for example, offers the same benefits on its employee-paid Advantage scheme as on its direct product, Good4You, but premiums are around 14% lower. Likewise, Healthsure offers employees a slightly cheaper price plus enhanced dental benefits if they purchase a plan through their employer.†

Greater productivity
Employers will also benefit. Jill Davies, executive director at Westfield Health, explains: “Giving employees access to a cash plan enables them to take a more proactive approach to managing their healthcare. This results in reduced sickness absence, greater productivity and helps to improve staff morale.”

Naturally, the bigger the take up, the greater the benefit for employers. Raman Sankaran, director of strategic development at LHF Healthsure, says: “There can be huge differences in take up. Some organisations will get less than 10% of employees taking out plans, others can see take up increase to 40% or more with time.”

Promotion is key to increasing take up. Healthcare cash plan providers can help with this by providing marketing literature for employers, as well as content for intranet sites and newsletters, but they all admit that cash plans are a product that needs to be sold. “It can be difficult to understand the value of the product when faced with a list of benefits,” says Davies, adding that many employees start to question whether there’s a catch.

To help on the sales front, providers will also get involved with presentations and promotional events. This has worked particularly well at Tesco, which offers its employees a cash plan from HSA on a voluntary basis. So far, 37,000 staff have signed up.

Abby Bowman, public relations manager at HSA, says: “Tesco allows us to send our sales people into the store canteens to talk to employees about the healthcare cash plan’s benefits. This is very effective and works much better than just providing marketing literature.”

As well as giving employees access to cash plan providers, Roberts believes employers can enhance the perceived benefit by the way they promote the plan. “Giving employees the opportunity to attend presentations during working hours rather than in their own time helps them see it as a benefit. Health awareness days, where employers put on a range of health-related events such as tests or provide health information, can also be an effective means of increasing take up and many providers are happy to attend these,” she explains.†

Enhancing take up
It is also essential to maintain a level of promotion rather than simply providing details at the plan’s launch or when an employee joins the company. “Once employees start taking out plans you can get a lot of referrals. Someone will have new glasses or have received their money back after a trip to the dentist and this will encourage other employees to sign up,” says Bowman.

Building take up can be lengthy and time consuming but cash plan providers will be patient while this happens. “We don’t insist on a minimum take up,” says Sankaran. Instead he wants to see that an employer is committed to promoting the plan to its employees. “If the only reason they want to implement a plan is so that they look good in their annual shareholder report then this won’t result in high take up,” he adds.

If you read nothing else read this…

• Voluntary healthcare cash plans offered through an employer can provide better terms, in price or benefits, than if bought by staff direct.
• Cash plan providers can help tailor marketing to an organisation’s requirements and provide marketing material and support.
• Face-to-face promotions, such as presentations and health awareness days, are the most effective way to increase employee take up.
• A healthcare cash plan, even if it is paid for by employees, can help to reduce sickness absence, and improve staff productivity and morale.

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