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July 22, 2013
Internal audits of benefits policies show spousal (or domestic partner) coverage costs employers up to 40% more than coverage for the employee. This revelation could inspire businesses to make two very bad decisions: hire talent based on employee marital status and/or, disproportionately raise benefit rates for families versus singles.
Spousal coverage is costly because utilization is high, but the explanations vary. On a national level, there are more women than men enrolled as spouses on employee benefits plans. Overall, women utilize health benefits to the tune of 31% more than men. With the average cost of a routine pregnancy being $7,400, maternity plays a major role in the cost discrepancy. There are other factors as well. The opens in a new windowWall Street Journal suggests women who work part-time or are stay-at-home spouses, are more likely to utilize health benefits. Finally, many of the largest claimants are spouses who are unable to work due to health reasons.
While speculation for these causes exists, the usage and cost trends are real. Is there a solution? We say, YES!
Skin in the Game
By bringing spouses into the benefits conversation employers can yield smarter consumers who are more connected to the company. This can potentially lead to a reduction in benefits utilization and lower employee turnover. Here’s how:
Company culture is a great source of pride at Parker, Smith & Feek. Our employees’ spouses are encouraged to participate in our wellness and philanthropic activities. It is our belief that involving the spouse in the benefits process and programs helps reduce cost and increase employee retention. We’ve seen some excellent results. We can use our experience to help you tailor a program for your employees.
Please click on the attachment below to view Pharmaceutical pdf.