Health benefits

How to retain employees by offering the right health benefits

To prevent employees from becoming another statistic in the big quit, companies may want to review the health benefits they offer. Some small business owners are embracing a perk once rarely found outside of the US military: free health insurance.

The average American worker pays $1,299 for an individual premium or $5,969 for a family premium each year, according to a 2021 survey from the Kaiser Family Health Foundation. With job openings still hovering near all-time highs and the unemployment rate stuck at 3.6%, founders are finding that one of the best ways to attract and retain talent is to bring that zero disbursements. Nearly half of the 475 companies on Inc.’s 2022 Best Workplaces list. now offer fully employer-paid health insurance. And 90% of employers rank health as the benefit most valued by their staff, according to the Society for Human Resource Management’s Benefits Survey.

At enterprise software company Bluestaq, one of Inc.’s Best Workplaces 2022, employees aren’t opening their health care wallets for themselves or their immediate family members. The defense technology contractor fully covers health, dental and vision insurance for its 63 employees as well as their spouses, partners and children. This generosity is rare and puts Bluestaq among only 4% of companies in the country that fully cover family premiums. It’s not cheap, however. Last year, the Colorado Springs, Colorado-based company paid out nearly $1 million in bonuses. Still, CEO Seth Harvey sees the line item as one of the company’s most meaningful investments and a powerful recruiting tool.

“It’s something we’re starting to be known for in our community,” Harvey says, adding that nearly everyone who applies to Bluestaq mentions the company’s free healthcare.

Almost all employees opt into the health care plan to some extent, but all Bluestaqers who wish to switch receive half the cost of the monthly premium on their paycheck. With a top-notch plan, the cash payout can be quite significant, Harvey says.

“I think one of the best things we’ve ever done was establish that as a benefit early on,” said Harvey, who co-founded Bluestaq in 2018 and built higher healthcare costs into his budget and its contractual rates from the start. “It’s hard to change your advantages on the road.”

While it might be difficult, it’s not impossible, as many Inc. 2022 Best Workplaces offering free healthcare have made the switch over the past year. For people based in New York Bizzabo, also an Inc. Best Workplaces winner, the decision began with an employee survey. The event technology platform was founded in 2011, and after more than a decade in business, its workforce has matured with the business. The 383 employees included more families and children, which made health care an even greater priority. In 2021, Bizzabo invested in its employer contribution for health, dental and vision insurance. The overhaul has resulted in 85% of employees, including those who cover children, paying nothing for health coverage.

When Tami Golan, Bizzabo’s Director of Human Resources, speaks with both employees and applicants, conversations about medical benefits come up much more often today compared to with two years ago. “People are interested in the benefits,” Golan said. “They’re very specific and very intentional about what kind of benefits they’re looking for.”

Bizzabo’s improved coverage has garnered positive feedback from current employees and helped attract new ones over the past year as the company has gone through a period of growth, Golan said.

Osano, a data privacy platform that helps websites comply with the alphabet soup of privacy laws, covered 80% of its employees’ bonuses. In 2021, the company, another Best Workplace winner, increased its contribution up to 100 for employees and 50% for dependents, joining just 12% of U.S. employers in doing so, according to Kaiser. The company also offers its fully remote workforce a monthly stipend for dependents’ benefits and has expanded its parental leave policy to include cases of miscarriage or stillbirth. The goal: to make Osano’s plan so comprehensive that its 39 employees never have to worry about health care costs.

Founding CEO Arlo Gilbert has been building startups for more than two decades and said the benefits Osano offers have become table stakes in today’s job market.

“You’re going to have higher caliber candidates,” he says. During the hiring process, top-notch perks allowed Osano to keep that part of the conversation short and focus more on job skills and cultural adjustments.

For any business owner considering making the switch, Gilbert says the return on investment is clear, even in the short term.

“It pays for itself very quickly,” he said. “The math works great. Your employees aren’t spending their time thinking about healthcare. Instead, they’re consuming the healthcare they need and want, and then they’re back in the office. “

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