Health care costs are the biggest concern for small business – again

3 min read · 7 years ago


In ‘Sunset Boulevard’, fading screen actress Norma Desmond famously
said, “I am big. It’s the pictures that got small.” Many U.S. employers
face a similar juxtaposition: Their companies might be small, but their
impact on our nation’s economy is big – huge even. According to the U.S.
Small Business Administration:

  • The 23 million small businesses in America account for 54 percent of U.S. sales.
  • Small businesses provide 55 percent of all jobs and have accounted for 66 percent of all new jobs since the 1970s.
  • There are more than 600,000 franchised
    small businesses in the U.S. and they account for 40 percent of retail
    sales and provide jobs for 8 million people.

29 years at the top

A recent survey by the National Federation of Independent Business
revealed that leaders of small companies have a lot on their minds.
Among those concerns are the economic outlook, burdensome regulations
and tax reform. But sitting squarely at No. 1 for the 29th consecutive
year – just short of three decades – is rising health care costs.
This echoes the results of the 2014 Aflac WorkForces Report, which
revealed that controlling health care costs is the primary objective of
49 percent of employers.

Changes to our nation’s health care system and the increased price of
health insurance mean employers continue to struggle with their health
care costs. For years, many small employers have shared the pain with
workers by eliminating some benefits and passing the cost of others on
to employees. In fact, over the last 10 years, the average premium for
employer-sponsored family health insurance has increased by 69 percent

Given that the still-recovering economy has meant years of lowered or
eliminated raises, bonuses and other perks for U.S. workers, the
increased cost of health care combined with reductions in benefits has
been hard for employees to absorb. It’s no wonder that 57 percent of
employees surveyed as part of the 2014 Aflac WorkForces Report said
they’d be likely to accept jobs with slightly lower pay but better
benefits. That’s bad news for small companies, especially
when you consider that hard-working, experienced employees are top-notch
business assets. So what’s a company to do?

The voluntary solution

One simple solution is introducing or adding voluntary benefits to
their employees’ health care options. Fully 50 percent of workers at
small companies who don’t have access to voluntary insurance at their
workplaces say they’d be likely to apply for coverage if given the

Voluntary, or supplemental, insurance policies work with major
medical insurance to help provide an extra layer of financial protection
for employees. Because premiums are usually fully paid by workers,
companies can add voluntary benefits to their benefits options with no
effect on their bottom lines.

Unlike major medical insurance, voluntary policies pay cash benefits
directly to employees if they’re sick or injured. At the same time, they
give employers the opportunity to strengthen their benefits packages
without adding to their benefits costs. As an added bonus, voluntary
insurance is simply good business: Workers with voluntary coverage are
more likely to be extremely or very satisfied with their benefits than
workers without.

If you’re a small-company leader who’s tired of having health care
costs at the top of your list of business concerns, consider the
opportunity voluntary benefits offer your company and the peace of mind
they help provide to your employees. It’s a small step that offers big